With housing affordability at the centre of national discussion, the Government of Canada has taken a major step to support first-time homebuyers. In May 2025, the government announced a new federal GST rebate for first-time buyers purchasing new homes across Canada. This rebate can offer savings of up to $50,000, depending on the home’s price.
This post was first published in June 2025, when the rebate was still a proposal. Update: it became law when Bill C-4 received Royal Assent on March 12, 2026, and the final rules below are from the Canada Revenue Agency.
What Is the 2025 GST Rebate?
Under the new program:
- First-time homebuyers can receive a 100% rebate on the 5% federal GST for newly constructed homes priced up to $1 million.
- For homes priced between $1 million and $1.5 million, the rebate is gradually reduced.
- Homes priced at or above $1.5 million are not eligible for the rebate.
In simple terms, the lower the price, the bigger the share of GST you get back. That makes the program most useful for new condos, townhouses and entry-level homes. In Mississauga and across the GTA, many new builds fall inside this range.
Who Qualifies for the Rebate?
To be eligible for the new GST rebate, the buyer must:
- Be a first-time homebuyer (no ownership of a home in the last 4 years).
- Be at least 18 years old.
- Be a Canadian citizen or permanent resident.
- Intend to use the home as their primary residence.
- Be the first occupant of the home.
Check each point carefully before you sign. For example, owning a home within the last four years could rule you out. Likewise, the home must be one you plan to live in, not a rental investment.
How Much Can You Save With the GST Rebate?
Let’s break it down with examples of various new home purchase prices:
| Home Price | GST (5%) | Rebate % | Rebate Amount | GST Payable After Rebate |
| $900,000 | $45,000 | 100% | $45,000 | $0 |
| $1,000,000 | $50,000 | 100% | $50,000 | $0 |
| $1,100,000 | $55,000 | 80% | $44,000 | $11,000 |
| $1,200,000 | $60,000 | 60% | $36,000 | $24,000 |
| $1,300,000 | $65,000 | 40% | $26,000 | $39,000 |
| $1,400,000 | $70,000 | 20% | $14,000 | $56,000 |
| $1,500,000 | $75,000 | 0% | $0 | $75,000 |
| $1,600,000 | $80,000 | 0% | $0 | $80,000 |
The rebate phases out in a straight line between $1 million and $1.5 million. At $1.25 million, for example, you would receive a 50% rebate.
What About the Ontario HST Rebate?
If you are buying a new home in Ontario, you may also qualify for a provincial HST rebate of up to $24,000 on the 8% provincial portion of HST. This is separate from the new federal GST rebate. It applies whether or not you qualify for the federal program, though conditions may vary.
Together, the two programs can make a real difference to your closing costs. So ask your builder and your lawyer how both apply to your purchase. You can also learn about Ontario programs on the Government of Ontario website.
How to Apply
There are three main routes to claim your GST rebate and any Ontario rebate:
- Federal rebate: submit Form GST190 to the CRA.
- Ontario rebate (if applicable): submit Form RC7190-ON alongside the federal form.
- Builder-assisted application: many builders offer to apply the rebate directly on your behalf at the time of purchase.
Keep copies of every form and receipt. That way, you can answer any follow-up questions from the CRA quickly.
Key Dates to Remember
- Law in force: Royal Assent on March 12, 2026 (Bill C-4).
- Eligibility window: agreements signed with the builder on or after March 20, 2025, and before 2031, with construction starting before 2031.
- Completion deadline: the home must be substantially completed, and ownership transferred, before 2036.
Mark these dates on your calendar. In particular, the signing date of your agreement decides whether you can claim the GST rebate at all.
Is the GST Rebate Right for You?
The 2025 GST rebate for first-time homebuyers is a game-changing incentive for Canadians looking to step into the housing market. Whether you are eyeing a $900K condo or a $1.3M detached home, this rebate can help reduce your upfront costs significantly.
If you are planning to buy a new home, make sure you understand how this rebate applies to your situation. Don’t leave thousands of dollars on the table. For a wider plan, read my essential steps for first-time buyers. You may also find it useful to compare a condo or townhouse for a first home. For background on how this idea began, see my post on the Liberal housing plan.
Talk to a Mississauga real estate agent
I am here to guide first-time buyers through every step, from eligibility to builder negotiations and rebate claims. Do you have questions about your own plans? Please send me a message or call 416 908 5600. I am A. Q. Mufti, Sales Representative, RE/MAX Real Estate Centre Inc., Brokerage, and I am always glad to help.
Disclaimer: this article was published on 3 June 2025 and reflects the information available at that time. Interest rates, prices, and government programs change, so check the current position before acting on anything here. It is provided for information only and is not financial, mortgage, tax or legal advice. A. Q. Mufti is a registered Sales Representative with RE/MAX Real Estate Centre Inc., Brokerage, Ontario, Canada.
