The home buyers tax credit is probably the least used government incentive when buying a home, so let’s fix that here and now. One of 3 main incentives available to Canadians that are buying a home, the home buyers tax credit is available along with the Home Buyers RRSP Plan and the Land Transfer Tax credit.
The Home Buyers Tax credit is available to first-time buyers OR anyone who has not owned a home in the previous 4 years and whom are buying:
- A single detached home.
- Semi detached home.
- Row house or townhome
- Live in multi unit property.
How much is the first time buyers tax credit?
The amount you would receive if you qualify is $750 at tax time. In other words, you get to claim up to $5000 in home buying expenses including legal fees, home inspection costs, and land transfer tax. Then the tax credit is calculated as 15% of the $5000 in expenses, for a maximum of $750.
How to Claim the First Time Buyers Tax Credit
When completing your taxes, use the $5000 amount on line 31270 of your tax return.
If you have a spouse or common-law partner, you can split the tax credit between the two of you – as long as the total claim is not more than $5000.
Be sure to hold on to the receipts and documentation sharing the expenses involved with buying your home. Like anything else income tax-related, it’s always a good idea to have a paper trail of your expenses.
Also like anything income taxes, its always a good idea to discuss with a tax specialist or accountant as well. But with this said, this is a pretty straightforward way for many homebuyers to get $750 back at tax time.