Looking to save on your next home renovation or energy upgrade? HST rebates provide a practical way for Canadian homeowners to recover substantial costs. Whether you’re embarking on a large-scale renovation or adding energy-efficient features, knowing how to file for an HST refund can make a big financial difference.
Curious about how it works? Below, we’ll unpack current HST rebate programs, the proposed First-Time Home Buyer’s rebate, and tips for claiming refunds. Plus, we’ll share step-by-step instructions and real-life examples to guide you on this journey.
What is the HST rebate, and how does it benefit you?
The Harmonized Sales Tax (HST) rebate is a federal program that provides homeowners with a refund for a portion of the HST paid on home-related expenses. For newly built, substantially renovated homes or certain energy-efficient upgrades, you could qualify for significant savings.
Understanding the details is key. There are two primary opportunities to claim rebates for renovations: the GST/HST New Housing Rebate and the proposed First-Time Home Buyer’s GST/HST rebate for 2025. Here’s what you need to know about both.
1. GST/HST New Housing Rebate
This rebate allows homeowners to recover part of the GST or HST paid when a home has been substantially renovated. This isn’t limited to demolishing and rebuilding—it encompasses comprehensive projects where 90% or more of the structure is upgraded or changed.
Eligibility for the New Housing Rebate
- You must own the property undergoing renovation.
- The home must be your primary residence or a relative’s.
- The value of your home after renovations should not exceed $450,000.
- The renovations must meet the CRA’s definition of “substantial,” covering major structural or system updates.
This rebate is especially helpful for sizable upgrades, such as full kitchen remodels, electrical system overhauls, or large-scale energy-efficient improvements.
How Much Can You Claim?
The program covers 36% of the GST paid, up to a maximum rebate of $6,300. If you live in a province that harmonizes its sales tax with GST, you may qualify for a portion of the HST instead.
Example Calculation
Imagine investing $100,000 into renovating your home. If $5,000 of that amount accounts for the GST, you could qualify for a rebate of 36%, resulting in $1,800 back in your pocket.
Steps to Apply for the GST/HST New Housing Rebate
- Obtain and complete Form GST190 from the Canada Revenue Agency (CRA website).
- Collect all relevant documents, including renovation contracts, receipts, and tax invoices showing HST paid.
- Ensure the application is filed within two years after the renovation’s completion date.
- If a contractor handled the project, confirm whether they applied the rebate to your bill directly. If not, proceed with the application yourself.
2. Upcoming First-Time Home Buyer’s GST/HST Rebate (Proposed for 2025)
In May 2025, the Canadian government proposed a new GST/HST rebate for first-time home buyers, including those undertaking substantial renovations. Though not yet passed into law, this program aims to offer even broader benefits.
Proposed Benefits
- No GST on homes valued at $1 million or less.
- Partial rebates on homes between $1 and $1.5 million, up to $50,000 in potential savings.
- Eligibility includes first-time homebuyers conducting substantial renovations.
Eligibility Requirements
- The renovation contract must be signed on or after May 27, 2025.
- The home must be your primary residence post-renovation.
- You must wait until the CRA announces legal approval for rebates before submitting a claim.
While this program has not yet received Royal Assent, planning projects with these potential savings in mind could still benefit homeowners. Monitor updates via the CRA’s website for further details.
Energy-Efficient Renovations and Your Rebate
Although there’s no dedicated rebate for energy-efficient upgrades under the HST program, many green renovations qualify as “substantial renovations,” making them rebate-eligible.
Examples of energy-efficient projects that could qualify include:
- Installing heat pumps or modernizing HVAC systems
- Replacing over 90% of windows and insulation
- Adding solar panels or battery storage systems
- Upgrading to energy-efficient appliances during major renovations
Combining these upgrades with structural changes increases your eligibility for rebates, especially if you’re renovating to achieve a greener and more sustainable home.
Practical Tips for Maximizing Rebates
- Plan Renovations Strategically: Ensure all relevant work qualifies under “substantial renovation” criteria.
- Save Receipts: Ensure invoices clearly list the GST or HST paid.
- Monitor Legislation: Stay informed on updates to the First-Time Home Buyer rebate in 2025.
- Leverage Provincial Programs: Pair the federal rebate with local energy-saving incentives for greater value.
Ready to File for Your HST Rebate?
Don’t leave money on the table! Whether you’re renovating today or planning for future rebate updates, accurate record-keeping and timely applications are key.
Download CRA Form GST190 now and start your journey toward savings!
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