There is a big misunderstand on how HST effects the cost of purchasing a home. The most important hings to understand: There is no HST charged on the purchase of a resale home or condo!
That means, whatever the sale price of the home is agreed on there is no tax in addition to the price. If you agree on $200,000, the cost of the home is $200,000. Many people believe they would pay 13% on top of that ($26,000!) and that is not the case.
However it is important to note that if you are building a new home (primary residence) there is HST on the purchase price, however there are rebates to offset the the taxes under a $400,000 sale price.
The only HST that is applied during the sale of a home is on those services provided. That includes: lawyer fees, moving expenses, real estate commissions, home inspections and other services you may require.
For more information please call our office and talk to one of our Realtors today!
St Thomas 519-631-8000
Here is a chart provided by the Canadian Government
GST-taxable before July 1, 2010 PST-taxable before July 1,2010 Is there a change to the amount of tax payable under the HST?
|New Homes up to $400,000||5%||No PST||No change|
|New Homes over $400,000||5%||No PST||Yes|
|Resale Homes||No GST||No PST||No HST|
|Real Estate Commissions||5%||No PST||Yes (changes to 13%)|
The new housing rebate will be 75 per cent of the Ontario component of the HST, up to a maximum of $24,000. The rebate will ensure that buyers of homes priced up to $400,000 will, on average, pay no more tax than under the PST system. However, applicable PST on building supplies is embedded in the price of the home.