If you’re thinking about buying your first home, you’ve probably heard about tax credits, rebates, special accounts, and now even talk about “no HST on new homes.”
It can get confusing fast.
Here’s a clear breakdown of what actually exists right now, what has ended, and what’s been proposed.
This information is current as of the beginning of 2026.
1. First Home Savings Account (FHSA)
The FHSA is currently one of the most powerful tools available to first-time buyers.
Here’s how it works:
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You can contribute up to $8,000 per year
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Maximum lifetime contribution of $40,000
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Contributions are tax-deductible
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Withdrawals for your first home are completely tax-free
It combines the best parts of an RRSP and a TFSA.
If you’re planning ahead even 2 to 5 years, this is often the first place to start.
2. RRSP Home Buyers’ Plan (HBP)
The Home Buyers’ Plan allows you to withdraw up to $35,000 per person from your RRSP to use toward a down payment.
Key points:
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No immediate tax penalty
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Must be repaid over 15 years
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Can be combined with a spouse or partner’s withdrawal
For couples, this can mean accessing $70,000 toward a down payment.
3. Ontario Land Transfer Tax Rebate
First-time buyers in Ontario may receive a rebate of up to $4,000 on provincial land transfer tax.
If you’re buying in Toronto, there is an additional municipal rebate available as well.
This can significantly reduce closing costs on your first purchase.
4. First-Time Home Buyers’ Tax Credit
The federal government offers a non-refundable tax credit for 2025 worth up to $10,000.
You claim it when filing your income taxes for the year you purchased.
5. GST/HST New Housing Rebate (Existing Program)
If you purchase a newly built home (or substantially renovated home) as your primary residence, you may qualify for a GST/HST rebate.
In Ontario:
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You may recover part of the federal 5% GST portion
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You may recover part of the provincial 8% portion
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The rebate phases out based on purchase price
In many cases, builders already factor this into the advertised purchase price and handle the paperwork directly, but eligibility still matters.
This program has existed for years and is currently active.
6. Proposed First-Time Buyer GST/HST Rebate (New Construction)
There has been significant discussion around a new federal proposal aimed at first-time buyers purchasing new construction.
If passed into law, the proposal would:
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Eliminate the 5% federal GST portion on new homes priced up to $1 million
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Phase out the benefit for homes between $1 million and $1.5 million
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Provide no rebate above $1.5 million
In simple terms, this could mean up to $50,000 in federal tax savings on qualifying new homes.
Ontario has also proposed expanding the provincial portion of the HST rebate for first-time buyers, which could further reduce costs if implemented.
Important: As of now, this proposal has not fully come into force. Buyers should confirm current eligibility and status before relying on it in a purchase decision.
If and when it becomes active, it could significantly impact affordability for first-time buyers considering pre-construction or new builds.
7. What No Longer Exists
The First-Time Home Buyer Incentive (the shared-equity program introduced in 2019) has officially ended and is no longer accepting new applications.
If you see references to that program online, they are outdated.
The Bigger Picture
Programs and incentives can absolutely help.
But none of them replace:
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Proper mortgage planning
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Understanding closing costs
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Having a strategy for down payment and monthly affordability
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Buying the right property for your stage of life
The incentives are tools. The plan is what matters.
If you’d like to understand how these programs apply to your specific situation, feel free to reach out.
We can map it out clearly and make sure you’re making decisions based on what’s real and current, not headlines.
