Canada First Time Home Buyer Tax Credit

Shop the best mortgage deals in Canada. approvU allows you to comparison-shop for the lowest rate mortgage deals across 25+ lenders and brands in Canada.

12K+

Mortgage Deals

25+

Lenders & Brands

$$

Huge Savings

Overview of Canada First Time Home Buyer Tax Credit

Every penny counts when buying your first house. After scrapping your bank account to finance the down payment and closing costs, the $750 First Home Buyers’ Tax Credit can help you recover even part of the house closing costs.

This guide covers everything you need to know about this tax credit, the eligibility criteria, applying for it, and other incentives available to you as a first-time homebuyer.

What Is The First Home Buyer Tax Credit?

The First Home Buyer Tax Credit, or simply the home buyer’s tax credit, is a program offered by the federal government to make homeownership accessible to Canadian residents looking to buy their first home.

This program allows first-time buyers to claim $5,000 as an income tax credit on a qualifying home. The $5,000.00 tax credit can get you a $750 tax rebate.

This program was introduced in 2009 as part of the federal government’s Economic Action Plan to help Canadians buy their first home.

The tax credit must be claimed within a year of buying your first home, and the purchased home must satisfy the qualification criteria outlined below.

Shop Across 25+ Lenders For Your Best Mortgage Deals

See Your Personalized Mortgages Online With approvU

Home Buyers' Tax Credit Eligibility Criteria

How do you qualify for the First Home Buyers’ Tax Credit?

To be eligible for this tax credit, you or your spouse or common-law partner must:

be at least 18 years old
be Canadian residents
have not owned or had an ownership interest in any property within the preceding four years of the purchase
have not lived in a home owned by your spouse or common-law partner in the past four years
provide documents for the purchase of the home

For the house to qualify, it must be:

located within Canada
registered in either your name or your spouse’s or common-law partner’s name, following the applicable land registration system
new construction or an existing house
single-family house, semi-detached house, townhouse, mobile home, condominium unit, or an apartment in a duplex, triplex, fourplex, or an apartment building
a co-operative housing corporation that gives you possession of the home
your primary residence within one year of purchase

How To Claim Your First Home Buyer Tax Credit

It is a simple process to claim your First Hoe Buyer Tax Credit. No application is required.

All you need to do is enter the $5,000 First Home Buyer Tax Credit value on Line 31270 of your income tax return.

You also can share this tax credit with your partner or spouse, as long as the total amount claimed does not exceed $5,000.

You will be credited with a $750 rebate in the filing year.

Other First-Time Home Buyer Incentive Programs

You should consider other first-time homebuyer incentive programs, such as the Home Buyer’s Plan and more, in addition to this first-time homebuyer tax credit.

First-time Homebuyer Incentive

The federal government launched this joint-ownership program to help first-time homebuyers reduce mortgage-carrying costs.

If you qualify, the federal government will contribute 5% (for an existing property) or 10% (for new construction) of the property’s value or purchase price.

For example, if you buy a current house priced at $450,000, the government will provide you with $22,500 (5% of $450,000.00).

This amount helps reduce the loan amount to buy the house by increasing your down payment.

However, your resources need to make a minimum down payment of 5% of the purchase price.

The money from the government is a non-interest loan. You are required to repay this money and a corresponding share of the appreciated value of the property whenever you sell the house.

Learn More: Canada First-Time Home Buyer Incentive Program

Land Transfer Tax Rebates

You must pay a land transfer tax or a land registration fee when you buy a house in a specific province, territory, or city within Canada.

These taxes are administered by the land registry of each province or territory.

Some provinces and cities offer these taxes rebates, which will help with the closing costs.

For example, qualified first-time homebuyers in British Columbia and Ontario can receive land transfer tax rebates.

Land Transfer Tax Guides By Provinces

Shop Across 25+ Lenders For Your Best Mortgage Deals

See Your Personalized Mortgages Online With approvU

GST/HST New Housing Rebate

You might also be entitled to a GST or HST rebate from the federal or provincial government.

This rebate is available to all homebuyers, not just first-time homebuyers.

To be eligible for this rebate, the house needs to be newly built or substantially renovated if it is an existing house.

The rebate depends on the home’s purchase price, and the house price must be $450,000 or less.

Home Buyers' Plan (HBP)

The First Time Home Buyer Plan (HBP) allows you to withdraw up to $35,000 (up to $70,000 for couples) from your Registered Retirement Savings Plan (RRSP) without incurring any penalties to help you buy your first home.

You have 15 years to repay this money to your RRSP account. The first year after purchasing the house is the grace period, so repayment is required.

Final Thought On First Time Buyer Tax Credit

As outlined above, there’s no better time to buy your first house in Canada. Many federal and provincial incentive programs are available to ease your financial burden.

The home buyer’s tax credit plan is an easy one for which to qualify. All you have to do is declare the $5,000.00 tax credit on your income tax filing.

Explore how to use approvU to apply for your mortgage as a first-time borrowers.

Get A Mortgage With approvU

approvU is everything you need to make the right mortgage decisions like a Pro!
Born in Canada for Canadians
Largest mortgage marketplace with over 12,000 mortgage deals from 25+ lenders
No baiting; not a lead generator; your information is never sold
Skip the appointments and apply online anytime; it takes less than 6 minutes.
Multiple approvals from a single submission
Control and track every step of your application as it moves through to funding.

Canada First Time Home Buyer Tax Credit

12K+

25+

$$

Skip To...

Overview of Canada First Time Home Buyer Tax Credit

What Is The First Home Buyer Tax Credit?

Shop Across 25+ Lenders For Your Best Mortgage Deals

Home Buyers' Tax Credit Eligibility Criteria

How To Claim Your First Home Buyer Tax Credit

Other First-Time Home Buyer Incentive Programs

First-time Homebuyer Incentive

Land Transfer Tax Rebates

Land Transfer Tax Guides By Provinces

Shop Across 25+ Lenders For Your Best Mortgage Deals

GST/HST New Housing Rebate

Home Buyers' Plan (HBP)

Final Thought On First Time Buyer Tax Credit

Get A Mortgage With approvU

Education

Tools & Resources

About approvU