Saving enough money for a down payment can be the biggest challenge to buying your first home. Here are three government programs that can help you afford the downpayment on your very own “home, sweet home.”
Home Buyers’ Plan (HBP)
The Canadian government’s Home Buyers’ Plan allows first-time homebuyers to withdraw up to $35,000 tax-free in a calendar year from their registered retirement savings plans (RRSPs) to put toward the purchase of a home (note that the withdrawal must be repaid over the next 15 years).
As a newcomer, you may not have been paying into your retirement plans for several years, but that’s fine. You can deposit funds into an RRSP until 90 days before withdrawing them under the HBP, in order to receive the tax benefit.
Home Buyers’ Tax Credit (HBTC)
This federal government program allows first- time homebuyers to claim a non-refundable tax credit of up to $750 in the year they purchase a home.
GST/HST New Housing Rebate
This federal rebate allows homeowners to recover some of the goods and services tax (GST) or the federal part of the harmonized sales tax (HST) paid for a new-build or substantially renovated homee HBP, in order to receive the tax benefit.
Don’t Forget: You can buy your first home in Canada with as little as a five per cent down payment. Call me for more information on New to Canada program and how it can help you start your next journey – to homeownership!