CRA Compliance & Reporting

HST Rebate on New Rental Property in Ontario (2026)

By June 29, 2026 No Comments
HST RebateHST Rebate
This article is for informational purposes only and does not constitute tax or financial advice. Consult a qualified accounting professional before making any tax or financial decisions.

Quick Answer

To claim the enhanced HST rebate on a new rental property in Ontario, you file the GST/HST New Residential Rental Property Rebate with the Canada Revenue Agency using Form GST524 and its Ontario rebate schedule. Unlike a home you live in, a builder cannot credit this rebate at closing, so you pay the full HST upfront and apply to the CRA yourself once a tenant signs a lease for long-term residential use. For agreements of purchase and sale signed between April 1, 2026 and March 31, 2027, Ontario’s enhancement returns up to $80,000 of the 8% provincial portion of the HST, and combined federal and provincial relief can reach up to $130,000 on qualifying new homes valued up to $1.5 million. You generally have two years from the relevant date to file, so submit as soon as your lease and closing documents are in hand.

New Rental Rebate Rules Just Got More Generous

You just signed for a brand-new rental condo, and the closing statement lands with a number you did not expect: thousands of dollars in HST stacked on top of the purchase price. For investors and landlords, that upfront tax has always stung, but in 2026 the math shifted in your favour.

Ontario’s 2026 Budget temporarily expanded the rebates that hand that tax back, and for the first time the larger relief reaches beyond first-time buyers to ordinary investors buying new homes to rent out. The catch is that rentals follow a different path than homes you live in, and the money does not come off your price at closing.

Handled correctly, a qualifying rental can recover a meaningful share of the HST you paid; handled carelessly, that refund can slip away. For the bigger picture on rental returns, see our take on how Canadian businesses profit from rentals.

$80,000Maximum provincial HST rebate
$130,000Maximum combined relief, federal plus provincial
1 yearWindow to sign your agreement, April 2026 to March 2027
2 yearsGeneral deadline to file the claim

Quick Start: Pick Your Path

Your rebate path depends on who is buying and how the property will be used. Individual landlords and sole proprietors who buy a new home to rent long-term typically claim the New Residential Rental Property Rebate (NRRPR). Corporations and builders can also qualify, though builders who construct and lease units face separate self-supply rules.
Individual landlord or sole proprietor

You bought a new or substantially renovated home and a tenant will move in under a long-term lease. The NRRPR is generally your route, and you file it yourself after closing.

Incorporated investor or holding company

A corporation can claim the NRRPR, but your ownership structure affects financing, GST/HST registration, and future tax. If you are weighing a company against personal ownership, our guide on incorporation versus sole proprietorship is a useful starting point.

Builder or developer

If you construct rental units and lease the first one yourself, the Excise Tax Act’s self-supply rules treat that as a deemed sale, changing how the rebate applies.

Buying a home to live in

Owner-occupied buyers use the New Housing Rebate instead, which the next section explains.

What the Enhanced HST Rebate Actually Covers (and What It Doesn’t)

Ontario’s 2026 enhancement temporarily rebates the full 8% provincial portion of the HST on qualifying new homes, up to $80,000, and the federal government is matching the 5% federal portion so combined relief can reach up to $130,000 on homes valued up to $1.5 million. It applies to rentals, not only first-time buyers.

The federal First-Time Home Buyers’ GST/HST Rebate only applies to a home you use as your primary residence, so a rental does not qualify for it. The rental relief instead flows through the New Residential Rental Property Rebate, and Ontario’s enhancement raised the provincial share that rebate can return.

To qualify, your agreement of purchase and sale generally must be signed between April 1, 2026 and March 31, 2027, the property must be a qualifying new or substantially renovated home, and it must be rented for long-term residential use.

Amounts step down as value rises. A qualifying home up to $1 million can see the full provincial portion rebated, the $80,000 maximum holds between $1 million and $1.5 million, then the rebate declines toward the existing $24,000 for homes above $1.85 million. These figures come from Ontario’s 2026 Budget and the CRA’s enhanced-rebate notice. For the wider sales-tax picture, our practical guide to new GST/HST rules adds helpful context.

ClearWealth Accounting Advisors
Maximum HST Rebate on a New Ontario Home by Price
Maximum provincial portion (8%) of the HST rebated at sample new-home prices under the 2026 enhancement. Illustrative figures; actual rebate depends on the exact price and eligibility.
Up to $80,000
Full provincial rebate on qualifying homes up to $1.5M
Up to $130,000
Combined federal and provincial relief
$24,000
Existing rebate for homes above $1.85M
Source: Government of Ontario 2026 Budget and CRA Notice 346 (Ontario Enhanced New Housing Rebate). ClearWealth Accounting Advisors · clearwealth.tax · For informational purposes only.

Owner-Occupied vs Rental: How the HST Rebate Differs

The biggest practical difference is timing and who handles the paperwork. For a home you live in, the builder can credit the rebate at closing and lower your price. For a rental, you generally pay the full HST upfront and apply to the CRA yourself, then wait for the refund to arrive.

That single difference reshapes how you budget. An owner-occupied buyer often never sees the rebate as cash because it is folded into the net purchase price. A landlord must fund the HST at closing and recovers it weeks or months later, once the application is processed.

The forms differ too. Owner-occupied purchases from a builder typically use Form GST190, while a rental claim uses Form GST524 with the Ontario rebate schedule. Each rebate carries its own use test: the owner-occupied rebate requires a primary place of residence for you or a relation, while the rental rebate requires a tenant in long-term occupancy.

The table below sets the two side by side. If you also want to understand the income-tax side of holding a rental, our overview of managing residential real estate tax pairs well with this rebate guide.

ClearWealth Accounting Advisors
Owner-Occupied Home vs New Rental Property: HST Rebate at a Glance
How the rebate works depending on whether you live in the home or rent it out to a long-term tenant.
What to know Home you live in (New Housing Rebate) New rental (NRRPR)
Who claims it You, the homeowner You, the landlord
Can the builder credit it at closing Yes, often applied against the price No, you pay the HST upfront and claim it back
Which CRA form Form GST190 (builder-built) Form GST524 plus the Ontario schedule
Use requirement Primary residence for you or a relation Tenant under a long-term residential lease
First-Time Home Buyers rebate May apply if you qualify Not available for rentals
When you get the money Reflected in your purchase price Refunded by the CRA after you file
Filing deadline Generally within two years Generally within two years
Source: CRA, GST/HST new residential rental property rebate and GST/HST new housing rebate. ClearWealth Accounting Advisors · clearwealth.tax · For informational purposes only.

How to Claim the Rebate: A Step-by-Step Roadmap

To claim the rebate, confirm your purchase falls in the eligible window, budget for the HST at closing, secure a qualifying long-term tenant, gather your closing and lease documents, complete Form GST524 with the Ontario schedule, and file with the CRA within the deadline. Most landlords apply after the first lease begins.
  1. 1
    Confirm eligibility and the windowCheck that your agreement of purchase and sale falls between April 1, 2026 and March 31, 2027 and that the home is a qualifying new or substantially renovated rental, as set out in the Excise Tax Act and CRA guidance.
  2. 2
    Budget for the HST at closingBecause the rebate cannot be credited by the builder on a rental, plan to fund the full HST yourself, and consider short-term financing to bridge the gap until the refund arrives.
  3. 3
    Secure a qualifying tenantThe first occupant must be a tenant under a long-term residential lease, and you should keep the signed lease in case the CRA requests it.
  4. 4
    Gather your documentsPull together the agreement of purchase and sale, the statement of adjustments, the lease, and invoices showing the HST paid.
  5. 5
    Complete Form GST524 and the Ontario scheduleThis is the New Residential Rental Property Rebate application, and missing fields or math errors are a common cause of delay.
  6. 6
    File with the CRA and track itSubmit within the filing window, generally two years from the relevant date, then monitor progress. Our practical guide to CRA My Business Account can help you manage correspondence and follow your claim.
ClearWealth Accounting Advisors
Your HST Rental Rebate Timeline: From Closing to Refund
Typical sequence and approximate timing for a New Residential Rental Property Rebate claim. Illustrative; actual timing varies by file.
About 2 months
Typical CRA processing once your claim is filed
Up to 2 years
General outer deadline to file your claim
File early
Submit as soon as your documents are ready
Source: CRA Guide RC4231 (GST/HST New Residential Rental Property Rebate) and CRA processing-time guidance. ClearWealth Accounting Advisors · clearwealth.tax · For informational purposes only.

Common Mistakes That Cost Landlords Their Rebate

A denied or clawed-back rebate usually traces back to a small, avoidable error. Watch for these:

  • →Missing the signing window. If your agreement of purchase and sale falls outside April 1, 2026 to March 31, 2027, the enhanced rebate generally does not apply, even by a single day.
  • →Assuming the builder will handle it. On a rental the builder cannot credit the rebate at closing, so the application is yours to submit.
  • →Renting short-term instead of long-term. The rebate is built for long-term tenancy, so a short-stay listing can put eligibility at risk.
  • →Confusing the two programs. The First-Time Home Buyers’ rebate is for a primary residence; landlords rely on the New Residential Rental Property Rebate instead.
  • →Missing the filing deadline. The window is generally two years from the relevant date, so file early rather than testing the limit.
  • →Submitting an incomplete GST524. Math errors, missing schedules, or absent documents are among the most common reasons claims stall.
  • →Trying to re-paper an older deal. Amending or re-signing a pre-existing agreement just to fit the new window can run afoul of anti-avoidance rules.

Many of these surface during a review, so it helps to understand how to prepare for and avoid CRA audits before you file.

Frequently Asked Questions

Can I get the HST rebate if I rent out my new condo instead of living in it?

Yes. Renting it out moves you from the homeowner rebate to the New Residential Rental Property Rebate, which is designed for landlords. You typically qualify when the first occupant is a tenant under a long-term residential lease and the home is new or substantially renovated.

How much HST can I actually get back on a new rental property in Ontario?

Under the 2026 enhancement, you may recover up to $80,000 of the 8% provincial portion, and combined federal and provincial relief can reach up to $130,000 on qualifying homes valued up to $1.5 million. The amount depends on the price and your eligibility.

Do I have to pay the HST upfront, or will the builder just take it off the price?

For a rental, you generally pay the full HST at closing. Unlike an owner-occupied purchase, the builder cannot credit this rebate, so you apply to the CRA afterward and wait for the refund. Budgeting for that upfront cost is essential.

What’s the deadline to apply for the rental rebate after I close?

The filing window is generally two years from the relevant date, such as when tax became payable or the property was substantially completed. Because deadlines vary by situation, it is wise to file as soon as your documents are ready rather than waiting.

Does my tenant’s lease have to be for a full year?

The rebate is intended for long-term residential use, and a lease of at least one year is the common benchmark. Short-term or vacation-style rentals typically do not qualify. Keep the signed lease, as the CRA may ask to see it.

I’m buying through my corporation, can the company still claim the rebate?

A corporation can claim the rebate on a qualifying rental, though ownership through a company affects financing, GST/HST registration, and future tax planning. The use and timing tests still apply, so professional advice helps you weigh corporate against personal ownership.

I gutted and renovated an old building to rent out, does that qualify?

It may. A substantial renovation, where roughly 90% or more of the interior is removed or replaced, can be treated like new construction for rebate purposes. The test is strict, so confirm your project meets the CRA’s definition before assuming you qualify.

Is this the same thing as the First-Time Home Buyers’ GST rebate?

No. The First-Time Home Buyers’ rebate applies only to a primary residence and excludes rentals. Your rental relief comes through the New Residential Rental Property Rebate. For more ways to reduce tax on a rental, see our guide to maximize real estate investment tax savings.

Get Your Rebate Claimed Correctly

ClearWealth helps Ontario landlords and investors confirm eligibility, prepare the GST524 application, and keep their filings clean. Explore our services or book a consultation to make sure your rebate is claimed correctly the first time.

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This article is for informational purposes only and does not constitute tax or financial advice. Tax rules, rates, and forms change, and parts of the 2026 enhancement were still being administered when this was written. Confirm current CRA guidance and consult a qualified accounting professional before acting.

Sources & References

  1. Canada Revenue Agency, GST/HST new residential rental property rebate (Guide RC4231; Form GST524): canada.ca
  2. Canada Revenue Agency, Notice 346, Ontario Enhanced New Housing Rebate: canada.ca
  3. Government of Ontario, Ministry of Finance, 2026 Budget, HST relief on new homes: budget.ontario.ca
  4. Canada Revenue Agency, GST/HST new housing rebate (owner-occupied context, Form GST190): canada.ca