The BC Provincial Gov. and federal goverments will combine the 7% provincial sales tax (PST) and the 5% federal Goods and Services Tax (GST) into a 12% Harmonized Sales Tax (HST) on July 1, 2010. Now is the time to start preparing for this change and HOW it will effect you if you are planning to purchase a New Home.
New Housing Rebates are available IF you purchase a New Home as your primary residence as:
a new home together with land
a new home together with leased land
a new mobile home or float home
a new home purchased through shares in a housing cooperative
a home constructed or substantially renovated (more than 90%) by the owner builder
Buyers of new homes will be eligible for a rebate of 71.43% of the provincial portion (7% of the HST's 12%) of the HST paid on the new home up to a maximum rebate of $26,250. Home prices at more than $525,000. will be eligible for a flat rebate of $26,250.
If you buy a pre-sale property and the agreement of P&S is dated after November 18, 2009 and you take ownership or possession after July 1st. 2010, you will pay the HST, but may be eligible for a new housing rebate. Those taking possession prior to July 1st. 2010 will not pay the HST but will pay the GST (current).
There are a number of additional terms and conditions surrounding this new Harmonized Tax as it applies specifically to Real Estate, please visit the Federal Gov. CRA site for additional clarification.
Footnote for Sellers: After July 1st; HST will apply to Real Estate sales commissions!