Young home buyers in Ontario would be smart to take advantage of every opportunity they can to help make the goal of purchasing their first home more obtainable.
We’ve decided to offer one of those opportunities with our first time home buyer discount for home insurance,but let’s discuss another opportunity available to first time home buyers in Canada; the first time home buyer tax credit (HBTC).
WHAT IS THE FIRST TIME HOME BUYER TAX CREDIT?
Since 2009, Canada has been offering a one time tax credit to first time home buyers to help make purchasing a first home a bit easier financially.
In 2022, the first time home buyer tax credit was increased from $750 to $1,500.
When your taxes are being filed on the year in which you purchased your first home, you will place $10,000 (previously $5,000 before 2022) on line 31270 of your tax return.
NOTE: If you owe less than $1,500 in taxes, then this tax credit will bring what you owe down to $0 but it will not result in a refund of any amount since it’s considered a non-refundable tax credit.
SOURCE: homesteadfinancial.ca
WHO QUALIFIES FOR THE FIRST TIME HOKE BUYER TAX CREDIT?
You can claim the first time home buyer tax credit if you meet the following criteria:
1\ You are 18 years old or older.
2\ You or your spouse has purchased a qualifying home (more on that below) within Canada.
3\ You have not lived in a home that you or your spouse purchased in the past 4 years (unless you are a person with a disability, in that case, you may qualify for the HBTC even if it’s not your first home).
4\ You intend to occupy the new home within 1 year of the purchase date.
If you’ve recently purchased or are planning to purchase your first home, make sure to mention this at income tax filing time. Saving an extra $1,500 in the year of your first home purchase is a great bonus!
SOURCE: canada.ca
SOURCE: cibc.com
WHAT IS CONSIDERED A “QUALIFYING HOME”?
Nearly all property types purchased within Canada count as a qualifying home that is eligible for the first time home buyer tax credit.
- Single-family homes
- Semi-detached
- Townhouses
- Mobile homes
- Condos
- Apartments, including those in duplexes, triplexes or fourplexes
You also qualify for the HBTC if you have an ownership share in a housing co-op that gives you an equity interest.
Homes under construction also qualify. You must move into the finished property within one year of the purchase closing date to be eligible.
Erie Mutual Insurance proudly serves the commercial insurance, farm insurance, home insurance and auto insurance needs of members throughout Southern Ontario including Haldimand, Niagara and Hamilton.
Please don’t hesitate to contact us with any questions you may have about this or any other topic related to your insurance.
