In British Columbia, Canada, Goods and Services Tax (GST) of 5% is due on the purchase of a new or substantially renovated home. It is not typically applied to resale (used) homes.
When is GST Payable?
GST is charged on the purchase price and is usually paid at the time of closing. The buyer typically pays the GST to their lawyer or notary, who then remits it to the government.
When Does GST Apply?
GST is applicable on:
- Newly built homes (including pre-sale condos)
- Substantially renovated homes (if 90% or more of the structure has been replaced)
- Vacant land sold by a developer
- Short-term rental properties purchased for business use
Are There Any GST Rebates?
Eligible buyers may qualify for a GST New Housing Rebate:
- Full rebate: If the home costs $350,000 or less (primary residence), you can receive a 36% rebate, effectively reducing the GST to 3.2%.
- Partial rebate: For homes priced between $350,000 and $450,000, the rebate is gradually reduced.
- No rebate: If the home is $450,000 or more, there is no GST rebate.
For investment properties, a New Residential Rental Property Rebate (NRRPR) may be available if the home is rented out for long-term residential use.
It’s always best to check with a lawyer, notary, or tax professional to ensure compliance and eligibility for any rebates.
