GST rebates for new home buyers.
GST Rebate for new home owners.
It was interesting to know that one can claim GST rebate on new house purchased from builders or self constructed on land owned by home owner.
Revenue Canada document # RC4028 (E) Rev. 08 states:
"The new housing rebate is a rebate available to individuals who build or buy a new house. This rebate allows you to recover a part of the GST or the federal part of the HST that you paid on the purchase price or cost of building a new house. If your house is located in Nova Scotia, you may qualify for an additional rebate."
Owner Built Houses
For owner built houses, you can claim the rebate if you meet all of the following conditions:
The property is a newly built or substantially renovated house (this includes a condominium unit, a mobile or floating home). This also includes a property that you converted from non-residential to your own residential use, or a major addition you built if you also made significant physical and functional changes to your existing house;
the house is to be the primary place of residence for you or a relation;
The fair market value of your house (including the building, land, and other structures such as a detached garage) is less than $450,000. It is the fair market value of the land plus the building when substantially completed, not the cost of construction, that must be used for this value;
you, or a relation of yours, are the first occupant since the construction or substantial renovation began or, if you sell the house and transfer ownership before it is occupied by anyone, the sale is exempt from GST/HST; and
You pay the GST/HST on the land or the construction materials and services related to the construction or substantial renovation, or on the mobile home or floating home.
NoteEven if the fair market value of your substantially completed house is $450,000 or more, you may still be eligible for a rebate if your house is located in Nova Scotia. However, this rebate is available for new house construction only and not for a substantial renovation or conversion
The forms one need to complete to claim the rebate is
GST –191 and GST-191 WS available on Canada Revenue Agency.
When House is purchased from a Builder
You may be eligible to claim the new housing rebate if you purchased a new or substantially renovated house from a builder, including a condominium unit, or a share of the capital stock of a co-op. To claim the rebate, you have to complete Form # GST 190 (GST/HST New Housing Rebate Application for Houses Purchased From a Builder.)
When you buy a house from a builder, the builder may pay the rebate directly to you or credit the amount against the total amount payable for the house. If you and the builder agree that the builder pay or credit you the rebate, you may not file the rebate application directly with us later.
NoteA builder who pays or credits you the rebate must ensure you are eligible for the rebate before the payment or credit is made. For example, is the house intended to be, on purchase, a primary place of residence for you or a relation?
If the builder pays or credits you the rebate, the builder has to file the application forms with his/her GST/HST return for the reporting period in which the rebate was paid or credited.
Builders should not confuse the above filing deadline for the application form with the four-year deadline for claiming input tax credits or the two-year deadline for purchasers.
There are five application types in Section C of Form GST190, GST/HST New Housing Rebate Application for Houses Purchased from a Builder. Each type has its own eligibility requirements and deadline.
Use Application Type 1A if you buy the house including the land from the same builder and the builder pays the rebate directly to you or credits the amount against the total amount payable for the house.
Use Application Type 1B if you buy the house and lease the land from the same builder and the builder pays the rebate directly to you or credits the amount against the total amount payable for the house.
Use Application Type 2 if you buy the house including the land from the same builder and the builder does not pay the rebate directly to you and does not credit the amount against the total amount payable for the house. In this case, you have to file the rebate application directly with us.
Use Application Type 3 if you buy a share of the capital stock of a co-op.
Use Application Type 5 if you buy the house and lease the land from the same builder and the builder does not pay the rebate directly to you and does not credit the amount against the total amount payable for the house. In this case, you have to file the rebate application directly with us.
If the builder pays or credits you the rebate, you do not have to send us any documents. The builder will send us the rebate application.
If the builder does not pay or credit you the rebate, you have to send us the following documents:
Form GST 190, GST/HST New Housing Rebate Application for Houses Purchased From a Builder;
a copy of your statement of adjustments; and
one of the following documents as proof of occupancy (a photocopy is acceptable):
the new house insurance policy with dates and coverage;
your vehicle insurance or registration that shows the new address; or an invoice for telephone, hydro, or natural gas hook-up and cancellation at the previous address.
For more details log on to
http://www.cra-arc.gc.ca/E/pub/gp/rc4028/rc4028-e.html - P166_9626
11 June, 2008
GST Rebate for new home owners.
It was interesting to know that one can claim GST rebate on new house purchased from builders or self constructed on land owned by home owner.
Revenue Canada document # RC4028 (E) Rev. 08 states:
"The new housing rebate is a rebate available to individuals who build or buy a new house. This rebate allows you to recover a part of the GST or the federal part of the HST that you paid on the purchase price or cost of building a new house. If your house is located in Nova Scotia, you may qualify for an additional rebate."
Owner Built Houses
For owner built houses, you can claim the rebate if you meet all of the following conditions:
The property is a newly built or substantially renovated house (this includes a condominium unit, a mobile or floating home). This also includes a property that you converted from non-residential to your own residential use, or a major addition you built if you also made significant physical and functional changes to your existing house;
the house is to be the primary place of residence for you or a relation;
The fair market value of your house (including the building, land, and other structures such as a detached garage) is less than $450,000. It is the fair market value of the land plus the building when substantially completed, not the cost of construction, that must be used for this value;
you, or a relation of yours, are the first occupant since the construction or substantial renovation began or, if you sell the house and transfer ownership before it is occupied by anyone, the sale is exempt from GST/HST; and
You pay the GST/HST on the land or the construction materials and services related to the construction or substantial renovation, or on the mobile home or floating home.
NoteEven if the fair market value of your substantially completed house is $450,000 or more, you may still be eligible for a rebate if your house is located in Nova Scotia. However, this rebate is available for new house construction only and not for a substantial renovation or conversion
The forms one need to complete to claim the rebate is
GST –191 and GST-191 WS available on Canada Revenue Agency.
When House is purchased from a Builder
You may be eligible to claim the new housing rebate if you purchased a new or substantially renovated house from a builder, including a condominium unit, or a share of the capital stock of a co-op. To claim the rebate, you have to complete Form # GST 190 (GST/HST New Housing Rebate Application for Houses Purchased From a Builder.)
When you buy a house from a builder, the builder may pay the rebate directly to you or credit the amount against the total amount payable for the house. If you and the builder agree that the builder pay or credit you the rebate, you may not file the rebate application directly with us later.
NoteA builder who pays or credits you the rebate must ensure you are eligible for the rebate before the payment or credit is made. For example, is the house intended to be, on purchase, a primary place of residence for you or a relation?
If the builder pays or credits you the rebate, the builder has to file the application forms with his/her GST/HST return for the reporting period in which the rebate was paid or credited.
Builders should not confuse the above filing deadline for the application form with the four-year deadline for claiming input tax credits or the two-year deadline for purchasers.
There are five application types in Section C of Form GST190, GST/HST New Housing Rebate Application for Houses Purchased from a Builder. Each type has its own eligibility requirements and deadline.
Use Application Type 1A if you buy the house including the land from the same builder and the builder pays the rebate directly to you or credits the amount against the total amount payable for the house.
Use Application Type 1B if you buy the house and lease the land from the same builder and the builder pays the rebate directly to you or credits the amount against the total amount payable for the house.
Use Application Type 2 if you buy the house including the land from the same builder and the builder does not pay the rebate directly to you and does not credit the amount against the total amount payable for the house. In this case, you have to file the rebate application directly with us.
Use Application Type 3 if you buy a share of the capital stock of a co-op.
Use Application Type 5 if you buy the house and lease the land from the same builder and the builder does not pay the rebate directly to you and does not credit the amount against the total amount payable for the house. In this case, you have to file the rebate application directly with us.
If the builder pays or credits you the rebate, you do not have to send us any documents. The builder will send us the rebate application.
If the builder does not pay or credit you the rebate, you have to send us the following documents:
Form GST 190, GST/HST New Housing Rebate Application for Houses Purchased From a Builder;
a copy of your statement of adjustments; and
one of the following documents as proof of occupancy (a photocopy is acceptable):
the new house insurance policy with dates and coverage;
your vehicle insurance or registration that shows the new address; or an invoice for telephone, hydro, or natural gas hook-up and cancellation at the previous address.
For more details log on to
http://www.cra-arc.gc.ca/E/pub/gp/rc4028/rc4028-e.html - P166_9626
11 June, 2008
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