Many people have asked as a First Time Home Buyer, what are some government incentives that they may apply for their first home? So let’s talk about them, in the province of British Columbia, you may look into the following:
1. Home Buyers’ Plan (HBP): The HBP is a program that allows first-time homebuyers to withdraw up to $35,000 from their Registered Retirement Savings Plan (RRSP) to use towards a down payment. The amount must be paid back within 15 years, and there are some eligibility criteria to meet. (What is the Home Buyers’ Plan (HBP)? – Canada.ca)
2. First-Time Home Buyer Incentive (FTHBI): The FTHBI is a shared equity program that allows first-time homebuyers to apply for a shared equity mortgage with the Canadian government. The program provides up to 10% of the purchase price of a new or existing home and can help reduce monthly mortgage payments (First-Time Home Buyer Incentive | Place to Call Home)
3. GST New Housing Rebate: The first time home buyers can apply for the GST New Housing Rebate to recover a maximum of 36% of the Goods and Services Tax (GST) paid on a new or substantially renovated home if the purchase price is $350,000 or less. A partial GST rebate is available for new homes costing between $350,000 and $450,000. (GST/HST New Housing Rebate – Canada.ca)
4. Property Transfer Tax Exemption: In British Columbia, the government offers a property transfer tax exemption for first-time homebuyers. To qualify, you must be a Canadian citizen or permanent resident who has never owned a property anywhere in the world, and would be occupying the home as a principal residence. To get the full exemption, the purchase price of the home must be under $500,000. For homes priced between $500,000 and $525,000, a partial exemption is available. (Property transfer tax exemptions – Province of British Columbia (gov.bc.ca))
5. Home Accessibility Tax Credit (HATC): The HATC is a non-refundable tax credit that helps first-time homebuyers cover the cost of certain home renovations that make their home more accessible. Since 2022 and subsequent taxation years, the budget proposes to increase the annual expense limit of the HATC from $10,000 to $20,000. This may allow a taxpayer to claim a tax credit of up to $3,000. (Home Accessibility Tax Credit (HATC) – Canada.ca)
6. (NEW in 2023) Tax-Free First Home Savings Account (FHSA): This plan, like the Registered Retirement Savings Plan (RRSP), allows Canadian First Time Home Buyers to save money towards the downpayment of their new home. Once the account is open, they are allowed to contribute a maximum of $8,000 per year into the account up to a $40,000 lifetime contribution limit. To open the account, the person must be at least 18 years of age and this money can only be saved up for purchasing their first home. (Design of the Tax-Free First Home Savings Account – Canada.ca)
7. Other BC Government Incentives for home improvement:
– Home Adaptations for Independence: For low income seniors and people with disabilities, eligible homeowners, renters and landlords can receive up to $20,000 per home in the form of a forgivable loan to finance home modifications for accessible, safe and independent living like installing handrails and bathtub grab bars, etc. (BC Rebate for Accessible Home Adaptations (BC RAHA) | BC Housing)
– BC Seniors’ Home Renovation Tax Credit: This is a non-refundable tax credit for seniors who make home renovations that improve accessibility, safety, or mobility in their home. The credit is worth up to $1,000 per tax year. (Home renovation tax credit for seniors and persons with disabilities – Province of British Columbia (gov.bc.ca))
– BC Home Energy Coach: This is a free service that provides homeowners with advice on how to improve their home’s energy efficiency and reduce energy costs. Homeowners can also access rebates and financing options to help them make energy-efficient upgrades to their home up to $6,000. (Community Energy Coaches • CleanBC Better Homes (betterhomesbc.ca))
– CMHC Eco Plus: This program offers a partial 25% of the Canada Mortgage and Housing Corporation (CMHC) premium refund to homeowners who purchase climate friendly housing. To qualify, the new home must meet the eligible building standards and/or the EnerGuide and EnerGuide GJ ratings. (CMHC Eco Plus, formerly Green Home | CMHC (cmhc-schl.gc.ca))
If you like what you read, please leave a comment below. Feel free to use my BC New Housing GST Rebate Calculator or Mortgage Calculator as well. Thank you!
