First Time Buyers
Buying a house for the first time is a big and important decision in your life. As someone who represents you and looks out for your best interest, I would like to introduce you to the First-Time Home Buyers’ Tax Credit.
First-Time Home Buyer’s Credit (FTHBC) is a government program geared towards buyers like you. The objective is to reduce costs associated with purchasing a home. As a first time buyer, you are eligible for a 15% income tax credit on a maximum of $5,000 of home purchase costs such as legal fees and land transfer taxes. It can be claimed for the taxation year that you acquired the house.
You are considered to be a first time buyer if neither you and your spouse or common-law partner has owned and lived in another home in the year of the purchase or in any of the four previous years.
Land Transfer Tax Rebates
When you purchase a home you must pay Land Transfer Tax. This tax is levied provincially based on the purchase price of the home. Some municipalities, such as Toronto, levy their own Land Transfer Tax in addition to the provincial fee.
The maximum provincial Land Transfer Tax (LTT) rebate is $2,000 and the maximum Toronto rebate (MLTT) is $3,725. The provincial rebate is based on a percentage of the purchase price from .5 percent on the first $55,000 and increasing incrementally to 2 percent for anything over $400,000. The Toronto rebate uses a similar structure.
If you are eligible for a rebate of all or a portion of the MLTT you owe. Your lawyer will be able to claim the rebate electronically through Teraview software when he/she registers your transfer/deed.