There is more help available to first-time buyers in Ontario than most people realise, and a fair amount of it goes unclaimed simply because nobody mentions it in time.
Land transfer tax refund
Ontario refunds first-time buyers up to 4,000 dollars on provincial land transfer tax, which covers the tax entirely on a home up to roughly 368,000 and reduces it above that. Your lawyer usually claims it at closing, but confirm rather than assume.
You count as a first-time buyer if you have never owned a home anywhere in the world, and your spouse must not have owned one while you were together.
The Home Buyers’ Plan
You can withdraw up to 60,000 from your RRSP toward a first home, tax free, and a couple can do that individually. Repayment starts a few years later, spread over 15 years, and anything you fail to repay in a given year gets added to your income for that year.
The money has to have been in the RRSP for 90 days before you withdraw it, which is another reason to plan early rather than in the week before closing.
The First Home Savings Account
The FHSA is the strongest of the lot, and it is underused. Contributions are deductible like an RRSP, and withdrawals for a first home are tax free like a TFSA. Both ends. There is nothing else in Canadian personal finance that does that.
Room accrues annually with a lifetime cap, and unused room carries forward once the account is open. If buying is anywhere in your next few years, opening one now starts the clock even if you cannot fund it heavily yet.
You can use the FHSA and the Home Buyers’ Plan on the same purchase.
The federal tax credit
The Home Buyers’ Amount is a non-refundable credit claimed on your return the year you buy, worth a few hundred dollars in real money. Small, easy to miss, and free.
Municipal and new-build extras
Toronto has its own land transfer tax and its own rebate, which matters if you are looking south. There are also HST rebates on new builds, usually handled by the builder and folded into the price, and it is worth checking how yours has treated it rather than assuming.
The one that changes your monthly payment
Insured mortgages with less than 20 percent down can now be amortised over 30 years for first-time buyers in some circumstances. That lowers the payment and raises the total interest, so it is a cash flow decision rather than a free win. Worth understanding properly before you take it.
Programs change
Thresholds and rules shift, sometimes mid-year, and old blog posts age badly. Treat the above as a map of what exists, then confirm the current numbers before you count on any of it.
If you are buying your first place in Simcoe County this year, would it help to go through which of these you actually qualify for?
General education, not financial advice. Figures are illustrative and subject to lender approval (O.A.C.). Lora Fenn, Mortgage Agent Level 1, Lic. #M25003153. Dominion Lending Centres YBM Group, FSRA #11129. 705-881-2780 · lfenn@dominionlending.ca
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