Government Programs and Regulations

First-Time Home Buyers’ Tax Credit

For the 2022 and subsequent taxation years, the Budget proposes to increase the amount used to calculate the HBTC to $10,000, which would provide a tax credit of up to $1,500 to eligible home buyers.

1. What are the current rules?

First-time home buyers may be eligible for a 15 percent income tax credit for closing costs.

Details

• To assist first-time home buyers with the costs related to the purchase of a home.

• The First-Time Home Buyers’ Credit (FTHBC) provides a 15 percent credit on a maximum of $5,000 of home purchase costs (e.g. legal fees, land transfer taxes, etc.), meaning maximum tax relief of $750. qualifying home

• 2.  What is changing?

The proposed changes would increase the amount used to calculate the HBTC to $10,000, which would provide a tax credit of up to $1,500 to eligible home buyers.

All other rules regarding the credit and the increased limit remain the same.

• Applicable to first-time buyers purchasing a home closing after January 27, 2009.

• The FTHBC is claimable for the taxation year in which the home is acquired.

• An individual will be considered a first-time home buyer if neither the individual nor the individual’s spouse or common-law partner owned and lived in another home in the calendar year of the home purchase or in any of the four preceding calendar years.

3. Where can I get more information on the current HBTC?

4. Where can I get more information on the change?

Program

First-time home buyers may be eligible for a 15 per-cent income tax credit for closing costs. For more information contact Service Canada at

1-800-622-6232 or visit www.fin.gc.ca