Canadian Home Buyers' Incentives, Tax Credits & Grants (2025 Guide)

Home Buyers' Plan (HBP): RRSP Withdrawals for Your Down Payment

• What it is: Withdraw up to $35,000 from your RRSP (per person) to buy or build your first home—tax-free if repaid within 15 years.
• Who qualifies: First-time buyers (or those who haven’t owned a home in the last 4 years), including certain situations after relationship breakdown.
• How it works: Withdrawals are not taxed as income if you repay at least 1/15th each year, starting the second year after withdrawal.
• Tip: Couples can combine withdrawals for up to $70,000 towards a down payment.
• How to apply: Complete CRA Form T1036 and coordinate with your RRSP provider.
• Resources: CRA HBP Details

First Home Savings Account (FHSA): Tax-Free Saving for First-Time Buyers

• What it is: A new registered account that lets you save up to $8,000/year (lifetime max $40,000) towards your first home. Contributions are tax-deductible and withdrawals for a home purchase are tax-free.
• Who qualifies: Canadian residents aged 18–71 who have not owned a home in the past 4 years.
• How it works: Combine the up-front tax deduction of an RRSP with the tax-free withdrawals of a TFSA—the best of both.
• Tip: Unused contribution room carries forward. You can combine FHSA withdrawals with the HBP for the same home purchase.
• How to open: Open an FHSA with a bank, credit union, or investment provider.
• Resources: CRA FHSA Details

Home Buyers' Tax Credit (HBTC): Federal Tax Break for First-Time Buyers

• What it is: A non-refundable tax credit of $10,000 (as of 2022), worth up to $1,500 in tax savings for first-time home buyers.
• Who qualifies: You (or your spouse/common-law partner) bought a qualifying home and neither has owned a home in the prior 4 years.
• How to claim: Enter the amount on Line 31270 of your federal tax return (T1).
• Tip: Both spouses can combine the claim, but $10,000 is the total per home—not per person.
• Resources: CRA Home Buyers' Tax Credit

Cash Grants, Rebates & GST/HST New Housing Rebate

• GST/HST New Housing Rebate: If you buy a new or substantially renovated home (from a builder), you may qualify for a partial rebate of GST or the federal portion of HST paid on the purchase price.
  • Maximum up to 36% of the GST, phased out on homes $350,000–$450,000.
  • Provincial new housing rebates may also apply (e.g., Ontario, BC).
• CMHC First-Time Home Buyer Incentive (suspended for 2024): Formerly offered a shared-equity, interest-free loan towards your down payment. The program is currently closed but may be revived or replaced in future federal budgets.
• Green/Energy Efficiency Grants: Many provinces and local utilities offer cash rebates or grants for new homes with energy-efficient features (heat pumps, insulation, windows, etc).
• Tip: Always check with your province and municipality for local grants and rebates before closing.
• Resources: GST/HST Rebates in Canada

Provincial & Municipal Home Buyer Incentives

• Ontario: Land Transfer Tax Refund for first-time home buyers (up to $4,000); Toronto offers a matching rebate for city land transfer tax.
• British Columbia: First-Time Home Buyers' Program waives or reduces property transfer tax on eligible purchases up to a threshold; additional rebates for newly built homes.
• Quebec: Home Ownership Program (Montreal) and other local grants help with down payments or provide cash rebates for new constructions or families.
• Alberta: Municipalities like Edmonton and Calgary periodically offer down payment assistance or grants for first-time buyers.
• Manitoba, Saskatchewan, Atlantic provinces: Some provinces or cities run periodic down payment assistance or tax credit programs—check with your local government.
• Indigenous Home Ownership: Special programs and grants may be available for First Nations, Métis, and Inuit home buyers—see First Nations Tax Exemptions.

For detailed, province-specific guides, see: Ontario | BC | Quebec | Alberta

How to Maximize Your Incentives: Stacking & Claim Tips

• Stack programs where possible: You can generally combine FHSA, HBP, HBTC, GST/HST rebate, and provincial land transfer tax refunds on the same home purchase.
• Meet all deadlines: Some incentives (like GST/HST rebates) require application within 2 years of closing.
• Document everything: Keep proof of occupancy, purchase agreements, and receipts for all claims.
• Check with your lender: Some down payment assistance programs may affect mortgage qualification or insurance.
• Review your Notice of Assessment: Confirm you received all credits—request adjustments if missed.

Frequently Asked Questions: Canadian Home Buyer Incentives