HOME OWNERSHIP INCENTIVES FOR FIRST TIME BUYERS
While numerous additional programs are offered on the provincial level, Canada's Economic Action Plan focuses on two national incentives: the First-Time Home Buyers' Tax Credit and expansion of the Home Buyers' Plan.
The home buyers' tax credit provides a $5,000 non-refundable income tax credit on a qualifying home acquired after January 27, 2009. The credit is calculated by multiplying the lowest personal income tax rate for the year by $5,000, providing tax relief up to $750. Home buyers can claim this one-time credit only in the tax year they purchase their home.
Additionally, first-time home buyers continue to have greater access to savings in their Registered Retirement Savings Plans (RRSP), in order to purchase or build a home. Withdrawal limits were raised to $25,000 (up from $20,000) per person for withdrawals made after January 27, 2009.
As well, first-time buyers may be exempt from the provincial Land Transfer Tax.
For more information on the First-Time Home Buyers' Tax Credit and the Home buyers' Plan, call 1-800-O-Canada or visit the Canada Revenue Agency at cra.gc.ca.