In 2009, the Federal Government introduced the First-Time Home Buyers’ Tax Credit (HBTC), through Canada’s Economic Action Plan. The HBTC was intended to assist first-time home buyers with the costs related to the purchase of a home, recognizing it is difficult for many buyers to save for a down payment. Canadians buying a home after January 29, 2009 can claim the HBTC on their income tax return for the year in which they make their purchase.
What is the value of the credit?
The value of the HBTC is based on $5,000.00 multiplied by the lowest federal income tax rate for the year. In 2013 for example, the amount of the HBTC would have been $750.00.
Who is eligible for the credit?
You qualify for the credit if you purchase a housing unit located in Canada, and neither you nor your spouse or common-law partner owned and lived in another home in the year of purchase or any of the preceding four years.
How do I claim the credit?
The HBTC is claimed on Schedule 1 of your Canadian Income Tax Return. CRA may request documentation supporting the purchase transaction, so save all related documents in your files.
For further information, please contact us or your accountant. CRA has an informative video at this link: