The 2022 Budget & HST Rebate in Ontario

Date Posted
03 May 2022
Recently, Ontario’s 2022 budget was announced, revealing changes to how HST (Harmonized Sales Tax) will be applied to assignment purchases of pre-construction condos, homes, townhouses. For those who will be closing on assignment sales of residential properties in Ontario, the budget announcement has created confusion regarding how taxes will be applied to property purchase. With these changes to the process set to go into effect on Saturday, May 7th, 2022, it’s important to understand what this means for you, sooner rather than later.Since the 2022 budget announcement, Ontarians buying and selling residential properties on assignment have been navigating some ambiguity concerning the HST Rebate on newly built homes. Here's what you should know: As of May 7th, 2022, HST or 13% Tax must be applied to the first buyer's (the assignor) profit of a pre-construction assignment sale - not the property's total sales price. To learn more about how the HST Rebate in Ontario affects your property transaction or assignment contract, you can read more here: or contact the Rebate4U team today.
The 2022 Budget & HST Rebate in Ontario

The HST Rebate on Assignment Prior to The Budget 2022 Announcement

Up until this announcement, you could buy a pre-construction property from the builder and then later decide that you want to flip the condo, house, or townhouse by selling it on assignment to a new buyer before closing. When selling a property that has been purchased from the builder to a new owner before closing, any profit is treated as business income so the assignor, or the seller, must pay HST (13%) to the government on any profits made on this transaction. The 13% HST will apply to the sale unless the assignee, the new/second buyer, can effectively prove that they will not be occupying the property as their primary residence.

What is Changing with the HST Rebate Now?

The changes to the HST rebate on assignment sales now mean that when you, the assignee, purchase a pre-construction property from an assignor and not the builder, you will have to pay HST on the entire amount of the purchase, rather than being taxed 13% on just the profits.

Are You Buying or Selling on Assignment?

The changes announced by the Government of Ontario will go into effect as of Saturday, May 7th. If you have an assignment sale of a newly built home that is set to close on or after May 7th, 2022, these HST modifications will apply to your transaction.

Understanding the New HST Rebate Changes

For many residential property buyers expected to close after May 7th, the changes to how HST is applied to assignment purchases have left an air of uncertainty and confusion. If you find yourself unsure about how to navigate your assignment purchase or sale according to the new guidelines or if you’re not certain whether your purchase is even eligible for HST Rebate in Ontario, the Rebate4U team can be of assistance. With more than a decade of experience working with property buyers and sellers in Ontario and liaising with the Canada Revenue Agency, the Rebate4U experts are equipped with the tools, contacts, and understanding to effectively manage the complexities of the HST Rebate process in Ontario.

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Made a mistake, or uncertain about your application? Don’t stress. Call Rebate4U to set up an appointment today. Our team of rebate experts can correct errors, communicate with the CRA, and streamline applications to ensure accuracy and maximize your rebate.Get Started Before Closing.Call us today to set up an appointment. 

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For over 10 years, the Rebate4U team has the knowledge and expertise to help residential property owners throughout Ontario successfully apply for regional HST Rebate programs.

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Our specialists offer complimentary consultations where we review your eligibility to determine whether you qualify for an Ontario HST Rebate so you can proceed with your application confidently.

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We are able to expertly navigate rebate opportunities, staying up-to-date on the most recent rebate developments and changes in the HST Rebate program to maximize returns. To date, we’ve successfully acquired millions of dollars for clients in total.

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The Rebate4U team is dedicated to delivering the highest level of customer service, we are here to answer your questions and help you navigate the intracises of your application easily and efficiently.

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