Tip of the Week
First-Time Home Buyers' Tax Credit (HBTC)
In 2009 a non-refundable tax credit was implemented for new home buyers that have acquired a qualifying home after January 27, 2009.
The credit for 2022 is $1,500, which is derived from multiplying the lowest personal tax rate for the year by $10,000 (15% for 2022 x $10,000 = $1,500).
To qualify for the HBTC you must purchase a qualifying home and neither the individual or individuals spouse or common-law partner can have owned another home in the year of purchase or any of the four preceding years.
For a home to qualify, it must be located in Canada and can be an existing home or one being constructed. They include:
If you purchase the home with a spouse, common-law partner or friend, you have the option of sharing the credit or one of you can claim the full amount. Please note that the total of both your claims cannot exceed $1,500.
The rules for HBTC eligibility differ for those with disabilities or those who are purchasing for a related person with a disability and you do not have to be a first-time home buyer to qualify.
This tax credit is no connected with the Home Buyers' Plan (HBP) even though many of the eligibility criteria are the same. Even if you take advantage of the HBTC you can still qualify for the HBP.