Home Ownership Incentives

If you are eligible, the RRSP Home Buyers’ Plan (HBP) allows you as an invidivual to withdraw up to $25,000 (or up to $50,000 per couple) from your RRSP to help you purchase or build a qualifying home for yourself or for a related person with a disability. Briefly, here's how the plan works:

• To be eligible, you (or your spouse) cannot have owned a home that you used as your main residence within the previous four years.
• You must agree in writing to buy or build a home.
• You must be a resident of Canada.
• If you and your spouse are eligible, you can each withdraw up to $25,000 - for a total of $50,000 - towards the down payment.
• The money you are taking out of your RRSP must have been in the account for a minimum of 90 days before it qualifies.
• If you have used the Home Buyers' Plan before, you cannot have any outstanding balance due.
• The prospective home must be in Canada, and it must be intended for use as your principal place of residence within one year of buying or building it.
• The money you withdraw must be repaid within 15 years, and you must pay back a minimum of 1/15th each year. If you miss a repayment, the amount must be reported as income on your tax return for that year.
• To make a repayment under the HBP, you must contribute to your RRSP in the year the repayment is due or in the first 60 days of the following year. Repayments begin the year after the one in which you made your withdrawal.

Visit the Canada Revenue Agency website for more information.

The First-Time Home Buyers' Tax Credit offers a $5,000 non-refundable income tax credit amount on a qualifying home acquired after January 27, 2009. The First-Time Home Buyers' Tax Credit was introduced as part of Canada's Economic Action Plan to assist Canadians in purchasing their first home. The credit is designed to help recover closing costs, such as legal expenses, inspections, and land transfer taxes, so you can save more money for a down payment.

At current taxation rates, the credit works out to a rebate of up to $750 in federal tax relief for all first-time buyers. After you buy your first home, the credit must be claimed within the year of purchase, and is non-refundable. In addition, the home you buy must qualify. If you are buying a home with a spouse, partner or friend, the combined claim cannot exceed $750.

Visit the Canada Revenue Agency website and the Department of Finance Canada for more information.

You may qualify for a rebate of part of the GST or HST that you paid on the purchase price or cost of building your new house, on the cost of substantially renovating or building a major addition onto your existing house, or on converting a non-residential property into a house.

Visit the Government of Canada website for more information.

Ontario’s Land Transfer Tax is a provincial tax payable by the purchaser of a property. Therefore, if you purchase a property or land you are responsible for paying Land Transfer Tax to the Province at the time the transaction closes. First Time Home Buyers receive a reduction of up to $4,000.00 on Ontario Land Transfer Tax. Please note that there is also Toronto Land Transfer Tax payable if purchasing in Toronto “proper”. However, First Time Home Buyers do not pay on the first $400,000 value.

Visit the Ontario Ministry of Finance website for more information.