How does the First-Time Home Buyers' Tax Credit work?
The First-time Home Buyers' Tax Credit was introduced as part of 'Canada's Economic Action Plan' to assist Canadians in purchasing their first home. It is designed to help recover closing costs such as legal expenses, inspections, and land transfer taxes.
The Home Buyers' Tax Credit, at current taxation rates, works out to a rebate of $750 for all first-time buyers. After you buy your first home, the credit must be claimed within the year of purchase and it is non-refundable. In addition, the home you purchase must be a 'qualified' home. If you are purchasing a home with a spouse, partner or friend, the combined claim cannot exceed $750. To receive your $750 claim, you must include it with your personal tax return.