Ontario HST Rebate on New Homes: What Buyers Should Know

The short answer

• The rebate has two parts: the Ontario Enhanced New Housing Rebate (up to $80,000, the provincial 8%) and the Ontario New Home Affordability Payment (up to $50,000, the federal 5%).
• Homes priced at $1 million or less can get full relief of both portions, for a combined maximum of $130,000.
• Homes between $1 million and $1.5 million get a flat $130,000 reduction and homes between $1.5 million and $1.85 million get a declining amount down to the standard $24,000 rebate.
• Homes priced at $1.85 million or more only qualify for the existing Ontario new housing rebate of up to $24,000.
• The home must be your or a relation’s primary residence and the purchase agreement must be signed within the eligible window.
• You apply through the CRA using the same form that already exists for new housing rebates and builders often credit the amount directly at closing.

How the Ontario HST rebate actually works

When you buy a newly built or substantially renovated home in Ontario, HST normally applies at 13%: 5% federal GST and 8% provincial tax, collected together because Ontario uses the harmonized system. That tax bill can be the single biggest surprise cost on a pre-construction closing statement, especially for buyers who budgeted around the sticker price and forgot the tax sits on top.

The new Ontario HST rebate was introduced as temporary relief and is delivered through two separate programs that work together. The first is the Ontario Enhanced New Housing Rebate or the Enhanced New Residential Rental Property Rebate for rental purchases, which covers the 8% provincial portion and is administered by the Canada Revenue Agency. The second is the Ontario New Home Affordability Payment, which tops up relief on the 5% federal portion and is administered directly by the province.

You do not fill out two different applications in most cases. Eligibility for the Ontario New Home Affordability Payment flows from eligibility for the Enhanced New Housing Rebate, so one CRA form generally triggers both.

Who qualifies for the Ontario HST rebate

To qualify, the home has to be what the rules call a “qualifying new home.” There are two main paths, depending on whether you are buying to live in it or buying it as a rental.

For a home you intend to use as your own or a relation’s primary residence, the purchase agreement with the builder generally needs to be signed between April 1, 2026 and March 31, 2027. Construction must begin by a set deadline and be substantially completed within a further window after that, so a project that stalls well past its original schedule could fall outside the relief even if your agreement was signed on time.

For owner-built homes, rather than homes bought from a builder, the relief is generally tied to when construction begins instead of when a purchase agreement is signed.

If you are buying a new home as a residential rental property, there is a separate category with its own construction start and completion deadlines. Because the rules are detailed and the dates matter, anyone buying pre-construction with the rebate in mind should confirm their specific closing and construction timeline against the current CRA notice before counting on the full amount.

How much is the Ontario HST rebate worth

The amount you can recover depends almost entirely on the home’s price. This is where a lot of buyers get confused, because the relief is generous at the lower end and tapers off as the price rises.

• $1 million or less: full relief of both the provincial and federal portions, up to a combined $130,000.
• Between $1 million and $1.5 million: a flat reduction, reported around $130,000 in current guidance.
• Between $1.5 million and $1.85 million: a declining amount, moving down from the flat reduction toward the existing $24,000 provincial rebate as price increases.
• $1.85 million or more: only the existing Ontario new housing rebate applies, up to $24,000.

Because these thresholds and amounts are set by government notice and have already been revised once, treat any specific dollar figure as a guide and confirm the current numbers with the CRA or Ontario.ca before you rely on them for a purchase decision.

Ontario Enhanced New Housing Rebate vs Ontario New Home Affordability Payment

Buyers often ask whether they need to apply for both programs separately. They do not, but it helps to understand how each piece works and who actually pays it out.

Feature	Ontario Enhanced New Housing Rebate (ENHR)	Ontario New Home Affordability Payment (ONHAP)
What it covers	The 8% provincial portion of HST	A top-up on the 5% federal portion of HST
Maximum amount	Up to $80,000	Up to $50,000
Who administers it	Canada Revenue Agency (CRA)	Province of Ontario
How you apply	CRA rebate application form	No separate application; eligibility flows from the ENHR claim
Who can reduce it	Not applicable	Reduced by any federal HST first-time home buyers’ rebate you also claim

How the HST rebate is actually paid to you

There are two common ways this plays out at closing and which one applies to you depends on your builder.

If the builder pays or credits the rebate to you directly, they submit the rebate application on your behalf and the consent sections on that form let the CRA share your information with Ontario so the affordability payment portion can be processed too. In practice, this usually shows up as a lower purchase price or a credit on your statement of adjustments, rather than cash in your account after the fact.

If you did not buy from a builder or the builder did not credit the relief to you and you paid the full HST, you apply yourself using the CRA forms for the Enhanced New Housing Rebate or the Enhanced New Residential Rental Property Rebate, whichever applies. Your consent again allows Ontario to pay out the New Home Affordability Payment portion based on that same application.

Either way, no separate Ontario-specific form exists for the affordability payment. It rides on the back of your federal rebate claim.

Does this affect the existing first-time home buyer rebates

Ontario and the federal government already have longer-standing new housing rebates in place and first-time buyers may also qualify for additional rebates on top of or instead of this temporary program, depending on timing and price. If you are entitled to a federal GST/HST new housing rebate or a first-time home buyers’ GST/HST rebate, your New Home Affordability Payment is reduced by whatever federal portion you already claim through those programs. The two are not simply stacked on top of each other without adjustment.

This is a detail worth going through carefully with your accountant or lawyer if you are a first-time buyer purchasing new construction, since the order you claim things in and which rebate you’re eligible for, can change your net result.

Why the one-year window matters for timing your purchase

This relief is temporary, tied to purchase agreements signed in a specific twelve-month window. If you are weighing a pre-construction purchase in the Greater Toronto Area or anywhere else in Ontario, the signing date on your agreement of purchase and sale is what determines whether you fall inside the eligible period, not your closing date years later.

That timing pressure is part of the intent behind the program. It is meant to pull forward demand for new construction at a moment when builders have been dealing with a slower pre-construction market. For buyers, it means a real home price advantage exists right now that will not necessarily be there if you wait for the next project phase or a later launch.

At the same time, do not let a rebate deadline push you into a purchase that does not otherwise make sense for your budget or your timeline. Construction delays happen and substantial completion deadlines further down the road are part of what determines whether the rebate holds.

What to do next

• If you are considering a new build or pre-construction purchase, ask the builder directly whether the HST rebate is being credited into the price or needs to be claimed after closing.
• Pull the purchase agreement and check the signing date against the eligible window before you assume the rebate applies.
• Talk to your mortgage broker or lender about how the rebate affects your financing, since a lower effective price can change your deposit and mortgage math.
• Confirm the current rebate thresholds and maximum amounts directly on the CRA or Ontario.ca pages before you build them into your offer or your budget.
• If you already own a newly built home that closed recently, ask your accountant whether you still qualify to apply retroactively.

If you are weighing a new build purchase in Ontario and want to know how the HST rebate actually changes your numbers on a specific project, call me, Kirby Chan, at 416-305-8008. I can walk you through current builder pricing, how the rebate is being applied on listings I’m watching and whether the timing works for your situation.