Harmonized Sales Tax (HST) – New & Resale Homes, Mississauga, Ontario

Background / Provincial Budget Details

The Budget presented by the provincial government on March 26, 2009 announced that the Province will be moving ahead with harmonizing the GST and PST, scheduled to take effect on July 1, 2010. Combing these taxes into a single Harmonized Sales Tax (HST) could have implications for home buyers, including:

• adding significant tax to services such as moving costs, legal fees, home inspection fees, mortgage insurance premiums, title insurance, and REALTOR® commissions; and,

• adding significant tax to the purchase price of newly constructed homes priced over $400,000.



HST - New Homes

• Newly constructed homes under $400,000 would not be subject to an additional tax burden.

• A proportional rebate will be available for buyers of new homes valued between $400,000 and $500,000.



HST – Resale Homes

• HST would not be applied on the purchase price of resale homes

• However, this Budget makes no exemption for services associated with resale home transactions. Under the proposed sales tax harmonization, costs such as legal fees, real estate commissions and home inspection fees will be subject to the harmonized sales tax at a rate of 13 per cent.