Getting a new house is a great investment, and besides having to gather the money you need, you will also have to think about the taxes. In Canada, those who are planning to purchase real estate have to keep on mind this aspect, and even if the taxes are directly proportional with each individual’s income (a measure aimed to support those who have modest means), the taxes are actually inevitable. Fortunately, the Canadian law allows the citizens to use a special system, the HST, in order to rebate the costs and lower the amount they have to pay. Furthermore, sometimes the HST credit can also be obtained for those who are planning to have major renovations to their current properties.
If you decide to have your own home and you want to buy it or start building it, you have to keep in mind that the state taxes also apply. Whether you are collaborating with a specialized real estate broker, a bank or you are dealing with the process yourself, you must know that the whole process is taxable. The taxes paid by real estate buyers are redirected to the Harmonized Sales Tax, also known as HST, which was issued by the government in 2010. In certain regions of Canada, this tax (Harmonized Sales Tax) represents the merger between the GST and the Provincial Sales Tax, and is aimed to support the citizens who want to buy goods or services, including real estate. In case you want to get a new home buyer tax rebate, you should collaborate with a dedicated company, that will help you lower the credit and pay less money.
Although the whole process seems simple, there are some things you need to know about the HST, before applying for a credit. While some provinces allow citizens to use the system for any type of house, in others, such as Ontario, for instance, you can only use it for new houses, not for those up for resale. In addition to this, you will have to fulfill certain criteria in order to get the credit. To begin with, you must be a resident of Canada, then meet one of the following requests: be at least 19, have a spouse (be married or have a common-law partner) and have and live with a dependent child.
As a general rule, the HST credit will help you diminish cost. The money you will receive varies on many factors, and the maximum amount that you are likely to receive is 6,300 $. The government offers this rebate only to those who qualify for the credit, after a diligent process takes place. The value of the home purchased or renovated is also an important element, as well as the income of the individual asking for the credit. For houses whose prices exceed 450,000 $, the owners can only request the credit once.