08/13/2026
Here’s how buyers of new Ontario homes can put HST rebates toward mortgage qualification.
Buyers of new homes in Ontario no longer have to pay the 13 per cent harmonized sales tax on their purchase and then wait to get the rebate.
The Canadian government made it clear in late June that buyers who plan to live in their new homes can assign the HST to the builder and do not have to pay the sales tax upfront.
That means that the buyer can now qualify for a mortgage of the purchase price without the 13 per cent sales tax.
Under the federal and Ontario governments’ temporary HST rebate on new homes, the homebuyer is eligible for a maximum discount of $130,000 on a new home priced up to $1.5-million. The rebate expires at the end of March, 2027.
Prior to the federal government’s June clarification, builders and lenders were not sure whether the buyer would be required to pay the HST on or after closing.
Awaiting details on HST rebate for new housing, Ontario homebuyers proceed without mortgage relief
That meant the buyer had to qualify for a larger mortgage to cover the cost plus the HST, raising questions about whether the market was reaping the full benefits of the tax break. (In Ontario, the HST combines the 8-per-cent provincial sales tax and 5-per-cent federal goods and services tax.)
Here’s how it now works.
To receive the rebate upfront, homebuyers must agree to assign the HST rebates to the builder, according to the CRA.
They must also complete two forms: The GST/HST New Housing Rebate application (form GST190) and a related provincial form (RC7190-ON). Both forms must be provided to the builder.
The buyer then receives the HST rebate on closing, which reduces the final amount payable for the home.”
Plus, this week’s best fixed and variable mortgage rates
