GST on New Construction Homes in BC: What Presale Buyers Need to Know

One of the most common surprises for first-time presale buyers is discovering that new construction carries GST, while a comparable resale home down the street doesn't. It's a real cost that needs to be budgeted for, but there are two federal rebate programs that can meaningfully reduce or eliminate it. Here's how GST applies to new homes in BC, based on current information published by the CRA and the Department of Finance.

This is general information, not tax advice. GST rebate rules involve conditions and calculations beyond what's summarized here, confirm the figures that apply to your specific purchase with an accountant or the CRA's current published guidance before relying on them.

Why new construction is taxed differently than resale

In Canada, the sale of a newly constructed or renovated home is treated as a taxable supply, subject to 5% federal GST. A resale home , an existing home simply changing hands between owners, is not subject to GST. That's the core distinction: buy a presale condo, a new multiplex unit, or a newly built house directly from a builder or developer, and GST applies on top of the purchase price. BC doesn't add a separate provincial sales tax on top of that, real estate here is subject to the 5% federal GST component only, not a combined HST rate the way it would be in a province with harmonized sales tax.

The regular GST New Housing Rebate, and why it rarely helps in Vancouver

There's a long-standing federal rebate, detailed in the CRA's RC4028 guide, that returns 36% of the GST paid, up to a maximum of $6,300, for new homes with a fair market value up to $350,000. The rebate phases out on a sliding scale for homes between $350,000 and $450,000, and disappears entirely above that.

The catch for Metro Vancouver buyers: the vast majority of presale condos and new multiplex units here are priced well above $450,000, which means this rebate, while still technically on the books, doesn't apply to most local purchases. It matters more in lower-priced markets elsewhere in the country.

The new First-Time Home Buyers' GST rebate

This is the program that actually moves the needle for a lot of Metro Vancouver buyers. Announced by the Department of Finance in May 2025 and now in effect, the First-Time Home Buyers' (FTHB) GST/HST rebate works on much higher thresholds:

• 100% GST rebate on new homes valued up to $1,000,000, GST is effectively eliminated for eligible first-time buyers.
• A declining partial rebate for homes valued between $1,000,000 and $1,500,000, phasing out completely at $1.5 million.
• The federal government has stated eligible buyers could save up to $50,000 on a new home under this program.

It generally applies to purchase and sale agreements signed with a builder on or after May 27, 2025 and before 2031, where construction begins before 2031 and the home is completed before 2036, worth double-checking against your specific presale contract's dates, since a purchase agreement signed before that window may not qualify.

What to actually check before you rely on either rebate

• Your eligibility as a "first-time" buyer. The CRA's definition involves specific conditions, confirm you actually qualify before budgeting around the rebate.
• Whether your specific purchase agreement date and completion timeline fall inside the eligible window.
• Whether the rebate is credited to you directly by the builder at closing, or whether you need to apply for it yourself afterward, this varies by transaction and should be spelled out in your purchase agreement.
• How the regular rebate and the new first-time buyer rebate interact for your specific price point, since most Vancouver-area purchases will rely primarily on the newer, higher-threshold program.

What this comes down to

• New construction and presale homes in BC carry 5% federal GST; resale homes generally don't.
• The regular GST New Housing Rebate covers homes up to $450,000 and rarely applies to Metro Vancouver presale pricing.
• The new First-Time Home Buyers' GST rebate eliminates GST on new homes up to $1 million and phases out by $1.5 million, for agreements signed on or after May 27, 2025.
• Confirm your eligibility, purchase agreement date, and how the rebate is applied with your accountant or the builder's closing team before you budget around it.
• Shopping for a new-construction home or presale in the Lower Mainland? Browse current listings or contact our team to talk through the numbers on a specific project.

Plan your next step

Use the home-buying guide to organise your search. Prepare your property questions, check the actual neighbourhood routes, and keep evidence separate from preferences when comparing homes.