Government Benefits for First Time Home Buyers
Purchasing a home is now more affordable due to recent government initiatives to assist first time home buyers.
The Federal and Ontario governments have initiatives to assist first time home buyers. These include:
New! - The Federal government announced in its 2009 budget the new Home Buyer Tax Credit for the 2009 tax year. If the proposal is enacted by Parliament, the credit will be worth up to $750 (15% of eligible expenses up to $5000) to offset the closing costs associated with the purchase of a home by first time home buyers. If there is more than one first-time home buyer, then this credit must be shared. It is not per person. For more information follow this link. The Federal government considers an individual to be a "first time home buyer" if neither the individual nor the individual’s spouse or common-law partner owned and lived in another home in the year of purchase or any of the four preceding years.
Improved! - The Home Buyer Plan has been available for years which allows first-time home buyers to withdraw funds from their RSP's to finance the purchase of a home. The Federal government announced in its 2009 budget an increase of the maximum withdrawal from $20,000 to $25,000, if enacted by Parliament. The HPB applies to all eligible first time home buyers. For spouses, each spouse can withdraw up to the maximum for a maximum of $50,000. Withdrawn funds must be repaid back to an RSP over the following fifteen years. For more information on the proposed changes, follow this link. For more information on the HPB generally, follow this link.
Improved! - The Ontario government announced in its December 2008 economic statement that the Land Transfer Tax Refund of up to $2000 for first time home buyers will now extend to the purchase of resale homes in addition to the previous refund applicable only to the purchase of newly constructed homes. For more information follow this link. Try our land transfer tax calculator. The Ontario government considers an individual to be a "first time home buyer" if the individual has never owned a home, or an interest in a home, anywhere in the world and the individual's spouse has not owned a home, or an interest in a home, anywhere in the world while being the individual's spouse.
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