New HST Rules For Buyers
The government raised the HST rebate threshold to $850,000 from $525,000 for new homes, meaning purchasers of new homes will be eligible for a rebate of up to $42,500, as of April 1 this year. The threshold will also apply to recreational homes outside the Lower Mainland and the capital region, which were previously not eligible for a rebate. The HST does not apply to resale housing.
If construction begins after April 1, 2013, the reinstated PST will apply. The government calculates this will cause about two per cent of PST to be embedded in the price of a new home.
For houses under construction before April 1, 2013, but with ownership after that date, the government will charge a transitional tax of two per cent and builders will get temporary housing transition rebates to offset PST on materials to help prevent double-taxation on homebuyers, the government announced.
The move is meant to smooth the transition from the HST back to the provincial sales tax. The five-per-cent federal portion of the HST will not change nor will any federal rebate programs change