The $130,000 Hack: Ontario’s New First-Time Buyer Rebates for 2026
The $130,000 “HST Vanishing Act” for Ontario First-Time Buyers (2026): What’s Proposed, What’s Real, and How to Qualify
Keyword focus: First-time home buyer GST rebate 2026 — plus the Ontario piece, the fine print, and the “don’t-budget-on-a-press-release” reality check.
- 🧾 Rebate basics
- 📌 Eligibility traps
- 🏠 New builds only
- ✅ Ontario-focused
If you’re a first-time buyer in Ontario, you’ve probably seen headlines claiming “up to $130,000” in savings on a new home. That number isn’t totally made up — but it’s also not a coupon you can slap on any listing like it’s Black Friday at the hardware store.
This guide explains what’s proposed federally and provincially, what’s already in place, how the rebates are usually delivered in the real world (builder credit vs filing later), and how to avoid the eligibility faceplants that turn “up to $130k” into “up to a polite shrug.”
Important: this is not legal or tax advice. Treat it as a builder’s roadmap, then confirm details with your lawyer/accountant using the official sources linked below.
Who it’s for
First-time buyers purchasing new or substantially renovated homes (not resale).
Biggest misunderstanding
It’s not “free money.” It’s tax relief with rules, timing, and paperwork.
Builder tip
Ask how the rebate is applied: builder credit at closing vs you filing later.
First: is the “2026 GST rebate” actually live?
Here’s the cleanest way to say it: the federal First-Time Home Buyers’ GST/HST rebate is described by the CRA as a proposed measure, tied to legislation that was tabled. The CRA page is the best starting point for what the proposal intends to do and how the rules are expected to work.
Official federal source (read this): CRA – First-time home buyers’ GST/HST rebate.
Ontario’s matching relief is described in Ontario’s Fall Statement as a new measure for first-time buyers, and Ontario provides an example showing $80,000 in combined provincial relief on a $1M new home. See: Ontario 2025 Fall Statement – Housing costs section.
Builder truth: don’t make a purchase decision based on a headline alone. Confirm the program status and effective dates from official sources, then budget with what’s real today — and treat anything “proposed” as a bonus, not a promise.
What the federal proposal says (and what “up to $50,000” really means)
The federal proposal is aimed at removing the 5% GST (or the federal portion of HST) for eligible first-time buyers on qualifying new homes. The headline thresholds matter:
- Up to $1,000,000: proposal describes 100% rebate of the GST / federal HST portion, to a maximum savings of $50,000.
- $1,000,000 to $1,500,000: proposal describes a linear phase-out (so the rebate shrinks as the price rises).
- $1,500,000+: proposal describes no rebate.
That “up to $50,000” number comes from the math: 5% of a $1,000,000 home is $50,000. If your new home is $850,000, the theoretical federal portion is 5% of that amount — but eligibility and how the rebate is applied still matters.
If you want the deeper background and how it connects to Ontario’s existing rebates, this internal guide is a good companion: HST new housing rebate Ontario (guide).
What Ontario’s proposal says (and why Ontario’s “$80,000” example is a clue)
Ontario’s Fall Statement describes additional relief for first-time buyers that would effectively rebate the 8% provincial portion of HST on qualifying new homes up to $1M, with phase-out to $1.5M. Ontario also states that its existing Ontario New Housing Rebate (up to $24,000) would continue for other eligible purchasers.
Ontario’s example is important: it says a first-time buyer of a $1,000,000 new home would benefit from $80,000 in combined provincial tax relief due to the new and existing Ontario rebates. That implies the proposed Ontario first-time buyer relief is designed to fill in the gap to reach the full 8% provincial portion for qualifying purchases, while the existing mechanism remains relevant.
Want a quick way to sanity-check numbers at different purchase prices? Use our internal tool: New Home HST Rebate Calculator (Ontario).
So where does “up to $130,000” come from?
In the cleanest theoretical case, a first-time buyer in Ontario buying a qualifying $1,000,000 new home could see:
- Federal portion: up to $50,000 (5% of $1,000,000) if the federal proposal applies to the purchase.
- Ontario portion: up to $80,000 in combined provincial relief per Ontario’s own example at $1M.
Add them together and you get the headline “up to $130,000.” The key word is up to. This is exactly like “up to 50% off” at the lumberyard: real, but you still need to check what’s included, what’s excluded, and whether the discount applies to your cart.
Quick table: what you can estimate without guessing (and what you must confirm)
| Item | What you can estimate now | What you must confirm before relying on it |
|---|---|---|
| Federal first-time GST/HST relief (proposed) | 5% of purchase price up to $1M (max $50k), then linearly phased out to $1.5M. | Whether the proposal is in force for your closing date; eligibility details for your situation; how to claim (builder credit vs filing). |
| Ontario first-time provincial relief (proposed) | Ontario indicates up to $80k in combined provincial relief at $1M; phase-out concept to $1.5M. | Implementation mechanics; whether relief is applied at closing; how it interacts with existing Ontario rebate in your transaction. |
| Existing rebates (already real) | Ontario’s existing new housing rebate is referenced by Ontario as up to $24k for eligible purchasers. | Your specific eligibility, paperwork, and whether the builder applies it at closing or you apply after. |
Practical builder move: when you’re pricing a new build or pre-construction, ask for the “HST and rebates” line item to be shown clearly in writing — and ask what assumptions the builder is making.
Eligibility traps (aka: how first-time buyers accidentally disqualify themselves)
Most people don’t lose rebates because they’re trying to game the system. They lose rebates because they assume “first-time” means “first-time in my life” or “first-time in Ontario.” The federal proposal uses a test that looks back over a defined period (for example, whether you lived in a home you or your spouse/common-law partner owned in the prior years). The CRA page includes examples that show how this can work.
Common “oops” situations we see in the field:
- Spousal ownership history: one partner owned a home recently, which can affect first-time status.
- Primary residence intent: rebates are generally designed for a primary residence, not a flip or pure rental.
- Resale vs new: these measures target new or substantially renovated homes — not resale homes.
- Timing mismatch: your agreement date and your possession/ownership date matter. “Signed in 2025, closed in 2026” can change the analysis.
If you’re comparing new build vs resale, also consider Ontario’s land transfer tax rebates for first-time buyers (different program, different rules). Here’s our guide: Land transfer tax Ontario rebate guide.
Builder reality: how these rebates show up at closing
In many new-build transactions, rebates can be handled one of two ways:
- Credited by the builder at closing: the builder reduces the amount you pay at closing, then the builder files/adjusts the rebate on the back end (this is common with some new housing rebates).
- Claimed by the buyer after closing: you pay the full amount and apply for the rebate with supporting documentation.
Why it matters: your financing and cash needed at closing changes depending on the method. So when someone says “you’ll save $X,” your next question should be: When? At closing, or months later? That difference is the size of a kitchen remodel (or at least a very nice fridge).
If you’re building new: use rebates as a planning lever (not a crutch)
If you’re building a custom home, rebates can help — but your bigger wins come from planning decisions you control:
- Design efficiently: simple footprints and sane spans reduce cost more reliably than any rebate.
- Pick your performance targets early: better envelopes and right-sized mechanical systems reduce operating costs for decades.
- Lock selections early: “we’ll decide later” creates change orders and delays, and rebates won’t rescue you from those.
If you’re in the “we’re thinking custom build” stage, these two pages help you get your numbers and expectations straight: ICFhome.ca cost calculator and Custom ICF home construction.
And if you’re still gathering plan ideas before you commit, this is a helpful starting point: Where to get house plans (ICF-focused, but the sourcing advice applies broadly).
Ontario examples (Toronto vs non-Toronto)
Example A (non-Toronto): You’re buying a $900,000 new build in Simcoe County as your primary residence. The “headline” federal portion would be 5% of $900k (subject to rules). Ontario relief is also framed around new homes up to $1M. Your actual outcome depends on whether the proposals are in force for your dates and your eligibility. The smart move is to price the home without proposed rebates first, then treat any confirmed savings as upside.
Example B (Toronto / GTA): Same purchase price, but the cash required at closing can be affected by how credits are applied and by other Toronto-specific costs. If you’re stretching your budget, the “credit now vs refund later” question matters. Your lender may also treat rebate assumptions differently, so keep your broker in the loop.
Where to track updates (without falling into rumor soup)
If you only check two pages, use the official CRA page and Ontario Fall Statement page linked earlier in this article. They’re the closest thing to a source of truth for the thresholds, examples, and current wording.
Builder truth: if a blog post says “it’s guaranteed,” but the official source says “proposed,” believe the official source. Your wallet will sleep better.
Next steps (do this before you fall in love with a floor plan)
Use rebates as a bonus, but build your plan on solid ground: confirm eligibility, confirm timing, and get numbers in writing from your builder and your advisors.
Ontario FAQ: First-time buyer GST/HST rebates in 2026
Is the “first-time home buyer GST rebate 2026” already available?
The federal first-time buyer GST/HST rebate is described by the CRA as a proposed measure connected to legislation that was tabled. That means you should not assume it applies to your purchase until official guidance confirms effective dates and how claims are processed. The safest approach is to budget as if proposed rebates are not guaranteed, then adjust if the rebate is confirmed for your agreement/closing dates. Use the official CRA page for the most current wording and examples.
Does this apply to resale homes in Ontario?
No — these proposed measures focus on new homes (and in some cases substantially renovated homes) where GST/HST applies in the way the program is designed to offset. A resale home purchase typically does not have HST added the same way, so the “remove GST/HST” concept doesn’t translate. If you’re buying resale, focus instead on other Ontario first-time buyer supports and your financing strategy. Always verify your situation with your lawyer or accountant, because the tax treatment depends on how the transaction is structured.
How does the $1M to $1.5M phase-out work in plain English?
Think of the rebate like a dimmer switch, not an on/off light. Up to $1,000,000, the proposal describes a full rebate of the federal portion (up to $50,000). Between $1,000,000 and $1,500,000, the rebate shrinks in a straight line as the price increases. At $1,500,000 or more, the proposal describes no rebate. The key practical point is that a home priced just over $1M may still get meaningful relief, but you should confirm the exact calculation method and your eligibility before you count on it.
What does “first-time buyer” mean if my spouse owned a home before?
This is one of the most common “gotchas.” Programs often test first-time status by looking at whether you or your spouse/common-law partner lived in a home you owned in a defined look-back period. That means even if you personally never owned a home, your household history can matter. The CRA page includes examples that explain how the test may be applied. Before you rely on any first-time buyer rebate, confirm the definition that applies to your household and the dates that matter for your transaction.
Will I get the rebate at closing, or do I have to apply later?
It depends on the transaction structure and the program mechanics. Some rebates are commonly credited by the builder at closing, which reduces your cash needed on possession day. Other times, you pay the full amount and apply afterward with documentation, which can mean waiting for processing. This distinction matters for your financing and cash flow. Ask the builder (in writing) how they are handling rebates and what assumptions they are using, and confirm with your lawyer/accountant so there are no surprises at closing.
Can I use this rebate if I’m buying a new build but renting it out?
These rebate concepts are generally designed around a primary residence intent, not an investment property strategy. If the home is not your primary place of residence, eligibility can change or disappear. Because intent, occupancy timing, and documentation matter, you should not assume eligibility for a rental scenario. If you’re considering buying to rent, confirm the tax implications and rebate eligibility with a qualified accountant and your lawyer, and be cautious about any builder marketing that treats rebates as automatic for all buyers.
How does Ontario’s “up to $80,000 provincial relief” relate to the existing Ontario rebate?
Ontario’s Fall Statement explains that Ontario’s existing HST New Housing Rebate (up to $24,000) would continue to be available for other eligible purchasers, and it provides an example where a first-time buyer of a $1,000,000 new home could benefit from $80,000 in combined provincial relief due to the new and existing rebates. In plain terms, Ontario appears to be proposing additional relief for first-time buyers that could “top up” the existing mechanism to effectively remove the 8% provincial portion up to the $1M threshold, then phase out above it. Confirm the final mechanics once implemented.
What paperwork should I keep so I don’t lose the rebate?
Keep everything that proves the transaction details and your eligibility: the agreement of purchase and sale, amendments/change orders, statement of adjustments, proof of occupancy/primary residence intent, and any builder documentation showing how HST and rebates were handled at closing. If the rebate is applied as a credit, keep the builder’s written explanation. If you must apply afterward, keep the forms and receipts organized. The easiest way to lose a legitimate rebate is not fraud — it’s missing documents, inconsistent dates, or assumptions that aren’t supported by the paperwork.
If I’m building a custom home, do these rebates apply the same way?
Custom builds can be eligible for new housing rebates depending on structure and conditions, but the paperwork and timing can be different than buying from a production builder. Owner-built scenarios often involve different forms and proof requirements. If you’re doing a custom build, treat rebates as part of your project accounting, not just a closing-day line item. The right move is to confirm eligibility early with your accountant and lawyer and ensure your builder’s invoicing and documentation are consistent with the way the rebate is claimed.
What if I buy at $1.49M — is it still worth thinking about?
Yes, because phase-outs can still produce meaningful savings near the top end, depending on the final implementation and your eligibility. That said, the closer you get to $1.5M, the smaller the rebate becomes under a linear phase-out design. If you’re shopping near that line, you should calculate scenarios with and without the rebate and be conservative. Also remember that lender qualification, closing costs, and cash flow may matter more than a smaller rebate amount. Confirm the precise calculation method once the program status is finalized.
Can I “double dip” this with land transfer tax rebates in Ontario?
These programs are separate. Land transfer tax rebates (provincial and, in some cases, municipal) have their own eligibility rules and caps, and they apply to a different part of the transaction than GST/HST relief. In many cases, a first-time buyer may qualify for more than one type of relief, but you should treat each program on its own terms and confirm eligibility with your lawyer during closing. The best strategy is to ask for a closing cost worksheet that shows each potential rebate separately, with assumptions clearly stated.
What’s the safest way to plan if I’m buying in 2026 and rules might change?
Plan conservatively. Build your budget and financing around today’s confirmed rules, then treat proposed rebates as upside — not your down payment plan. Ask your builder how they will handle rebates if they become available, and get that answer in writing. Keep your lawyer and accountant involved early so your agreement dates, closing dates, and documentation align with eligibility requirements. This approach isn’t pessimistic; it’s just how you avoid making a long-term housing decision based on short-term political headlines.