The 2026 buyer question: can the federal GST rebate reduce the tax on a new Montreal condo, townhouse or newly built home — and how does it stack with FHSA, HBP and Quebec’s welcome-tax rebate?
The federal First-Time Home Buyers’ GST/HST Rebate is one of the biggest affordability changes for buyers considering a newly built home, condo or townhouse in Quebec. It can eliminate the federal GST on qualifying new homes up to $1 million and reduce the GST on qualifying new homes between $1 million and $1.5 million.
If you are a first-time buyer purchasing a qualifying newly built home as your primary residence, you may be eligible for up to $50,000 in federal GST relief. The full rebate generally applies up to $1 million, then phases down between $1 million and $1.5 million. Above $1.5 million, the federal first-time buyer GST relief is not available.
The federal rules use a first-time buyer test tied to whether you or your spouse/common-law partner owned and lived in a home in the current or previous four calendar years. If you owned an investment property, separated recently, bought with family, or lived outside Canada, verify your situation before relying on the rebate.
One of the biggest pain points is timing. Current CRA guidance generally points to builder purchase agreements entered into on or after March 20, 2025 and before 2031, not simply the closing date. Buyers who signed before the applicable date but close later may not qualify. Before you change your budget, confirm the agreement date with the builder, notary and CRA guidance.
On a $700,000 newly built condo, the 5% GST is $35,000. If the buyer and property qualify, the federal rebate could potentially eliminate that $35,000 GST amount. But the buyer still needs to budget for the down payment, notary, inspection, adjustments, condo fees, mortgage insurance if applicable, and Quebec/municipal items like welcome tax.
Can help fund the down payment if contributions and withdrawals are handled correctly.
Eligible buyers may be able to withdraw from RRSPs under the HBP rules; confirm repayment obligations.
Separate 2026 Quebec measure for eligible first-time buyers. It may reduce transfer-duty pressure, but timing and claim process matter.
Federal relief for qualifying new homes. It does not apply to ordinary resale homes.
Get the price, tax treatment, rebate assignment language, deposit schedule, occupancy fees, estimated condo fees and closing adjustments reviewed before signing. The wrong assumption can change your cash-to-close by tens of thousands.
Generally no. Ordinary resale homes are not usually subject to GST, so this federal first-time buyer GST relief is mainly a new-construction issue.
Do not assume that. The federal program is GST/HST relief. Quebec buyers should verify the separate QST/new housing rebate treatment with Revenu Québec, the builder and the notary.
Potentially, yes, if you meet each program’s separate rules. They are different programs with different eligibility and timing requirements.
Signing date can matter. Current CRA guidance generally uses March 20, 2025 as the key start date for builder purchase agreements, with additional deadlines. Buyers should verify the agreement-of-purchase date and effective-date rules before assuming eligibility.