Good news for new-home Buyers, the HST rebate that was once “coming soon” has officially arrived.

When we last wrote about HST rebates in early June 2026, the Ontario Enhanced New Housing Rebate (ENHR) was still waiting for the final pieces of legislation and regulations to fall into place. The waiting game is now over. The ENHR is officially in effect and can provide eligible buyers with significant HST relief on qualifying new homes in Ontario.

ENHR was introduced as part of Ontario’s 2026 housing affordability measures. The Ontario legislation, Bill 114 – HST Relief Implementation Act (Residential Property Rebates), 2026, received Royal Assent on May 12, 2026.

The implementing regulations followed in late-June 2026, with the ENHR being effective retroactively from April 1, 2026. This means that qualifying agreements entered into on or after April 1, 2026, may benefit from ENHR, subject to the applicable eligibility requirements.

The ENHR is generally available for qualifying new homes purchased from a Builder where the Agreement of Purchase and Sale was entered into between April 1, 2026 and March 31, 2027. There are also construction and completion deadlines that must be satisfied.

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In order to be eligible for the ENHR for purchase of new homes from Builders, the following criteria must also be met:

• The construction or substantial renovation of the property must begin on or before December 31, 2028, and be substantially completed on or before December 31, 2031

• HST must become payable on or before December 31, 2032

• The property must be acquired for use as the Buyer's or their immediate relation's primary place of residence

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ENHR is structured based on the value of the home, as below:

• Up to $1 million: 100% of the 8% provincial HST, up to $80,000.

• Over $1 million and up to $1.5 million: flat rebate of $80,000.

• Over $1.5 million and below $1.85 million: the rebate gradually decreases.

• $1.85 million and above: the enhanced rebate is not available, although the existing Ontario New Housing Rebate of up to $24,000 may still apply.

There is another important piece to the puzzle.

The Federal Government has also introduced new HST relief for qualifying first-time home buyers, the First-time Home Buyers’ GST/HST Rebate (FTHB Rebate). Depending on the circumstances, an eligible Buyer may receive relief from the Federal 5% portion of HST by claiming the FTHB Rebate.

For Buyers who qualify for the Ontario ENHR but do not qualify for the Federal FTHB Rebate, the Ontario New Home Affordability Payment (ONHAP) may also provide additional assistance. The ONHAP can provide up to $50,000, subject to its own eligibility requirements and reductions for certain federal rebates.

If a Buyer is eligible for the Federal FTHB Rebate for the 5% Federal part of the HST, they must claim that rebate first to determine their eligibility for the ONHAP. If any portion of the 5% Federal part of the HST cannot be rebated through the FTHB Rebate, the Buyer may be able to recover that amount through the ONHAP.

One of the most important practical questions for Buyers is whether the Builder will credit the HST rebate on closing, or whether the Buyer will have to apply directly to the CRA after closing. And the answer is… it depends!

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It depends, in large part, on what the Agreement of Purchase and Sale says. Among other provisions, Buyers should carefully review the Agreement to determine:

• Whether the purchase price is stated as inclusive or exclusive of HST;

• Whether the Builder has agreed to credit applicable HST rebates on closing;

• Whether the Purchaser is responsible for repaying a rebate if the CRA later determines that the Purchaser was not eligible; and

• What happens if the rebate is delayed, denied or otherwise not available at closing.

The rebate is here. The fine print is still important.

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At Kormans LLP, we regularly assist Buyers with new-build and pre-construction transactions, including reviewing HST and rebate provisions. If you are considering purchasing a new home in Ontario in 2026, understanding the HST implications before you sign can make a significant difference to your closing costs. Please feel free to contact our team at info@kormans.ca or 905-270-6660.

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