What is the New Housing Rebate (NHR)?
The New Housing Rebate (NHR) allows buyers to recover part of the federal HST portion and part of the provincial HST portion paid on a qualified home.
In Ontario homebuyers can request for a rebate of up to 36% of the 5% federal HST portion, to a maximum of $6,300 for homes costing $350,000 or less. New homes priced between $350,000 to $450,000 would receive a much smaller percentage. New homes priced at $450,000 or over would not qualify for a rebate on the federal portion of the HST.
Buyers may also recover 75% of the remaining 8% of the provincial HST. Unlike the federal portion, the NHR does not decline in rebate if the price reaches above $350,000. The provincial portion of NHR does not apply to any purchase prices exceeding $400,000. The maximum amount of the provincial portion of the NHR returned is $24,000.
NHR applies to a person constructing or renovating houses for sale and may also include:
- Vendor of a new mobile home
- Person who buys previous unoccupied new house for resale
- Person who has interest in a house while the house is under construction or substantial renovation and assigns another person to complete the construction or substantial renovation
- Person who has converted a non-residential property into a house
- Buyer who bought a new or substantially renovated house from a builder and HST is due on closing
- Builder sold the buyers the house and related land on which the house is located under the same written agreement of purchase and sale
- Buyer signed the agreement of purchase and sale and intended it to be the primary place of residence
- Ownership of the house transferred to the buyers after construction or renovation is completed
- No other individual occupying the house before possession being given to the buyers
- Buyers or their relations are the first occupants of the house after construction or renovation
Buyers may assign the NHR to their builder. The builder may apply for the rebate on the buyer’s behalf.