Tax Rebate – First Time Home Buyer

When you buy land or an interest in land in Ontario, you pay land transfer tax. First-time homebuyers of an eligible home may be eligible for a refund of all or part of the tax. To claim a refund, you must be at least 18 years of age, you cannot have owned a home or an interest in a home anywhere in the world, and your spouse cannot have owned a home or interest in a home, anywhere in the world while he or she was your spouse.

Previous ownership in a home means you do not qualify for the land transfer tax first-time homebuyer’s refund. The method of acquiring the home (e.g., purchase, gift or through an inheritance) is not relevant.

Land transfer tax applies to all conveyances of land in Ontario. First-time homebuyers may be eligible for a refund of all or part of the tax payable.

· For agreements of purchase and sale entered into before December 14, 2007, the refund only applies on the purchase of a newly constructed home.

· For agreements of purchase and sale entered into after December 13, 2007, the refund applies to all homes, whether newly constructed or resale.

Qualifying taxpayers may claim an immediate refund at time of registration as follows:

· If registering electronically, by completing the required statements under the Explanation tab of the electronic land transfer tax affidavit, or · If registering by paper, by filing an Ontario Land Transfer Tax Refund Affidavit for First-Time Purchasers of Eligible Homes form at the Land Registry Office.

If the refund is claimed at the time of registration, it may offset the land transfer tax that would be payable. If the refund is not claimed at registration, the tax must be paid, and a claim for the refund may be submitted to the Ministry of Finance. No interest is paid on this refund. Procedures for refunds are outlined below, under Procedures to apply for the refund.

Eligibility

To qualify for the Ontario Land Transfer Tax Refund for First-Time Homebuyers, you must meet the following criteria:

· You must be a Canadian citizen or permanent resident of Canada,

· You must be 18 years of age or older,

· You must live in the home within 9 months of purchasing it,

· You cannot have owned a home before, and

· If you have a spouse, they cannot have owned a home during the time they have been your spouse.

Based on the Ontario land transfer tax rates, the rebate will cover the full tax amount up to a maximum home purchase price of $368,333. For homes with purchase prices over $368,333, homebuyers will qualify for the maximum rebate, but will still owe the remainder of their land transfer tax.