Worked Examples and Checklists
New build vs resale home: the tax arithmetic in Ontario, BC and Alberta
Worked comparisons of GST/HST, rebates, land transfer tax and builder closing adjustments on a new home versus a resale home at the same price, for first-time and repeat buyers.
At the same sticker price, a new home usually carries more tax than a resale home, because GST or HST applies to new housing and not to most resale homes. Since 2026, the gap closes or reverses for first-time buyers: the First-Time Home Buyers' GST Rebate removes up to $50,000 of GST on new homes up to $1,000,000, and in BC the newly built home exemption can remove property transfer tax as well. In Ontario, first-time buyers can also get the provincial 8% part rebated on new homes up to $1,000,000. For repeat buyers, and in HST provinces where the provincial part is only partly rebated, the resale home still often comes out ahead on tax. New homes also bring builder closing adjustments that resale buyers do not pay.
This guide is part of Worked Examples and Checklists. The rules are explained in GST/HST on new homes. Figures are illustrative, using rates published for 2026.
First: how is the new-home price quoted?
Before comparing, read the HST or GST schedule of the agreement. Builders typically quote one of:
- Price plus GST/HST. Tax is added on top.
- Price including GST/HST, net of rebates assigned to the builder. The builder has already deducted the rebates it expects you to qualify for. If you do not qualify, the builder charges you the difference on closing.
The examples below use the pre-tax price so the arithmetic is visible.
Example 1: British Columbia, $900,000 condo, first-time buyer
| Item | New condo from developer | Resale condo |
|---|---|---|
| GST 5% | $45,000 | $0 |
| First-time buyer GST rebate | -$45,000 | — |
| Property transfer tax ($900,000 x 2% - $2,000) | $16,000 | $16,000 |
| Newly built home exemption (full to $1,100,000) | -$16,000 | — |
| First-time buyer PTT exemption (ends at $860,000) | — | $0 |
| Tax payable | $0 | $16,000 |
Here the new condo saves $16,000 in tax. A repeat buyer of the same new condo would pay $45,000 GST but still get the newly built home exemption from PTT, for $45,000 against $16,000 on resale.
Example 2: Ontario (Ottawa), $850,000 townhouse, first-time buyer
| Item | New townhouse | Resale townhouse |
|---|---|---|
| HST 13% | $110,500 | $0 |
| — of which federal 5% | $42,500 | — |
| — of which provincial 8% | $68,000 | — |
| First-time buyer GST rebate (federal part, full under $1M) | -$42,500 | — |
| Ontario first-time buyer HST relief (provincial 8%, full under $1M) | -$68,000 | — |
| Land transfer tax ($4,475 + 2% x $450,000) | $13,475 | $13,475 |
| Ontario first-time buyer LTT refund | -$4,000 | -$4,000 |
| Tax payable | $9,475 | $9,475 |
With both first-time buyer HST rebates, the tax is the same as on resale. Before the Ontario first-time buyer relief, only the basic Ontario new housing rebate of up to $24,000 applied: $44,000 of the provincial 8% remained and the new townhouse cost $53,475 in tax, $44,000 more than resale. Ontario has also announced a temporary full-HST rebate for all buyers of new homes up to $1,000,000 with agreements from 1 April 2026 to 31 March 2027, which still needed federal implementation; check ontario.ca and the CRA before you sign.
Example 3: Alberta (Edmonton), $600,000 house, repeat buyer
| Item | New house | Resale house |
|---|---|---|
| GST 5% | $30,000 | $0 |
| First-time buyer rebate | Not eligible | — |
| GST new housing rebate (only under $450,000) | $0 | — |
| Land transfer tax | None in Alberta | None |
| Land titles fees | Small, similar | Small, similar |
| Tax payable | $30,000 | about $0 |
For a repeat buyer, the new home costs $30,000 more in tax at the same price. A first-time buyer would get the full $30,000 back.
Builder closing adjustments
New-home agreements, especially in Ontario, often list charges added on closing beyond the price. Common examples:
| Adjustment | What it is |
|---|---|
| Warranty enrolment fee | In Ontario, the new home warranty enrolment fee the builder pays and passes on |
| Utility meter and connection fees | Water, hydro, gas installation |
| Development charges or levy increases | Increases after the agreement date, if the contract allows them to be passed on |
| Condo reserve fund contribution | Some months of common expenses at the start |
| Occupancy fees (condos) | Interim monthly fees between occupancy and final closing, before title transfers |
These can add thousands of dollars. Ask your lawyer to review the schedule before the cooling-off period ends (for new condos in Ontario, the Condominium Act gives buyers 10 days to rescind after receiving the signed agreement and disclosure statement).
Decision checklist
- Are you a first-time buyer under the federal definition (no home you or your spouse owned and lived in during this year or the previous four)?
- Is the agreement dated after 19 March 2025, and will the home be your primary residence?
- Is the price above $1,000,000 (partial rebate) or $1,500,000 (none)?
- In BC, is the fair market value under $1,100,000 for the newly built home exemption?
- In Ontario, which rebates does the price already assume?
- What closing adjustments does the agreement allow, and are they capped?
- How does the total compare with a resale home after land transfer tax and any renovation you would do?
Frequently asked questions
Is a substantially renovated home treated as new?
It can be, if most of the interior was removed or replaced. Then GST/HST applies and the first-time buyer rebate may be available. Ask the seller how they treat it.
Does the federal rebate apply to the provincial part of HST?
No. The First-Time Home Buyers' GST Rebate covers the GST or the federal 5% part of HST. Provincial rebates are separate.
Can I claim the rebate after closing if the builder did not credit it?
Yes, you can apply to the CRA directly within the time limit. Keep the agreement and closing documents.
Are condo occupancy fees part of the price?
No. They are monthly charges before final closing and are not credited to the price.
Sources
- Canada Revenue Agency — First-Time Home Buyers' GST Rebate and new housing rebate
- Government of British Columbia — newly built home exemption
- Ontario Ministry of Finance — Ontario new housing rebate, first-time buyer HST relief and land transfer tax
- Home Construction Regulatory Authority — Ontario builder licensing
- Tarion — Ontario new home warranty
