What is First Time Home Buyer Tax Credit?
First Time Home Buyer Tax Credit is a federal non-refundable tax credit. It is available to you, your spouse or common-law partner to purchase their first home.
How Much Is The Tax Credit
The Home Buyer Tax Credit is a combined total of $10,000 where you, your spouse or common-law partner can claim. This is equivalent to a $1,500 tax deduction based on the lowest income tax rate.
Either you, your spouse or common-law can claim that total amount or split amongst yourselves.
The $10,000 is a non-refundable tax credit, it will reduce your income tax payable. If you do not owe income tax, it will not benefit you.
Who Is Eligible (individual, with partner)
If you, your spouse or common-law partner are buying a home for the first time, or have not owned a home in the last 4 years, you are eligible to claim this benefit.
Those who claim disability tax credit may also qualify for the First Time Home Buyer Credit on the year they purchase the home. They do not need to be first-time home buyers.
If you purchase a home for someone who is claiming the disability credit to live in, you may claim the credit.
What Type of Homes Are Included
Most of the single-family residential homes in Canada qualify for the tax credit.
This includes
- Detached houses
- Semi-detached houses
- Townhouses
- Condo units
- Apartment units
- Mobile homes
The house must be registered under your name, your spouse or your common-law partner’s name. You must move into and live in the house within one year of purchase.
How To Claim
You claim this amount when you are completing your tax return.
On line 31270 of your return, you enter $10,000, if you are the only person claiming
If more than one person claims this credit, the $10,000 has to be split among them. The total credit claim cannot be more than $10,000.
With the 15% tax rate, the $10,000 tax credit will result in a $750 tax refund.
Does it affects Fist Time Home Buyer’s Plan
No. It does not affect the Home Buyer’s Plan.
Home Buyer Tax Credit is to help you lower the amount of income tax on the year you purchase the house.
Other Home Buying Incentives
First-Time Home Buyer Incentive
The First-Time Home Buyer Incentive helps people across Canada purchase their first home. The program offers 5 or 10% of the home’s purchase price to put toward a down payment. This addition to your down payment lowers your mortgage carrying costs, making homeownership more affordable.
Home Buyer’s Plan
This is a program that allows you to withdraw from your registered retirement saving plan (RRSP) to buy a home. You can withdraw up to $35,000.
First Time Home Buyer Rebate
First-Time Home Buyer Incentive –
GST/HST new housing rebate
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