Did you buy a home?
If you bought a home, you may have qualified for tax credits. These credits can save you money.
Home Buyers’ Plan (“HBP”)
The HBP is a program that allows you to withdraw a particular amount from your registered retirement savings plan (“RRSP”). The withdrawal amount is determined by the Canada Revenue Agency (“CRA”) at predefined periods. The amounts withdrawn from the RRSP must be used to buy a qualifying home for the individual withdrawing the funds or for a related person with a disability. Additionally, the withdrawn funds must be repaid within a predetermined period.
First-Time Home Buyers’ Tax Credit (“HBTC”)
The HBTC is a non -refundable tax credit awarded to particular individuals who meet the predetermined criteria. The tax credit can be applied to an individuals’ personal tax return for the year the home was acquired.
Generally for an individual to qualify for the HBTC, they must
- Acquired a qualifying home; and
- Did not live in another home that was owned either by themselves, their spouse, or their common-law partner in the year of acquiring the home and a predetermined period preceding the acquisition.
What is a qualifying home?
A qualifying home is a residence with the following characteristics:
- The home must be located in Canada;
- The home must be registered in yourself and/or your spouse’s or common law- partner’s name in accordance to the legal land registration system in the respective area;
- The home can be an existing home such as a single-family house, townhouse etc.;
- The home can be under construction.