When Does GST Apply to Real Estate in BC?
In British Columbia, the Goods and Services Tax (GST) of 5% applies to some real estate purchases — but not all. Whether you owe GST depends primarily on whether the home is brand new or a resale (previously lived-in) property.
Key Takeaway
| Feature | GST Applies (5%) | GST Exempt |
|---|---|---|
| New construction | ✓ Yes | |
| Presale condo (never lived in) | ✓ Yes | |
| Substantially renovated home | ✓ Yes | |
| Resale home (previously occupied) | ✓ Exempt | |
| Resale condo (previously occupied) | ✓ Exempt | |
| Vacant land (personal use) | ✓ Usually exempt |
GST on New Construction Homes
If you're purchasing a brand-new home from a builder or developer, GST is charged at 5% on the purchase price. This applies to:
- New detached houses built by a developer
- New townhomes in a development
- Presale condos being sold for the first time
- Custom-built homes on your own lot
- Substantially renovated homes (where 90%+ of the interior is new)
Here's what 5% GST looks like at common new build price points in Surrey and the Fraser Valley:
| Purchase Price | GST (5%) | Before Rebate |
|---|---|---|
| $500,000 | $25,000 | $525,000 |
| $700,000 | $35,000 | $735,000 |
| $900,000 | $45,000 | $945,000 |
| $1,000,000 | $50,000 | $1,050,000 |
| $1,200,000 | $60,000 | $1,260,000 |
⚠️ GST May Be Included in the Price
GST New Home Rebate — How to Save Thousands
The federal government offers a GST New Home Rebate that can return a portion of the GST you paid on a new home. This rebate can save you thousands of dollars if you qualify.
Here's how the rebate works:
- 36% rebate on GST — You can recover 36% of the GST paid, up to a maximum rebate of $6,300.
- Full rebate threshold — The full 36% rebate applies to homes priced at $350,000 or less.
- Partial rebate — For homes between $350,000 and $450,000, the rebate is gradually reduced.
- No rebate above $450,000 — If your home costs more than $450,000, you are not eligible for the federal GST rebate.
💡 BC Provincial Rebate
| Home Price | GST Paid | Rebate Amount | Net GST |
|---|---|---|---|
| $350,000 | $17,500 | $6,300 | $11,200 |
| $400,000 | $20,000 | $3,150* | $16,850 |
| $450,000 | $22,500 | $0 | $22,500 |
| $700,000 | $35,000 | $0 | $35,000 |
| $1,000,000 | $50,000 | $0 | $50,000 |
* Partial rebate — reduced proportionally between $350,000 and $450,000.
Calculate Your GST New Home Rebate
See exactly how much you can save with the GST New Home Rebate on your purchase.
Buying Resale vs. New — GST Comparison
When comparing a resale home to a new build at the same price, the GST difference is significant. Let's compare a $900,000 purchase:
| Feature | Resale Home ($900K) | New Build ($900K) |
|---|---|---|
| Purchase Price | $900,000 | $900,000 |
| GST (5%) | $0 | $45,000 |
| GST Rebate | N/A | $0 (over $450K) |
| Property Transfer Tax | $16,000 | $0* |
| Net Tax Cost | $16,000 | $45,000 |
* New builds under $1,100,000 may qualify for the newly built home PTT exemption.
This is why it's critical to understand all the costs before deciding between new and resale. For a complete picture of closing costs, check out my guide on closing costs when buying a home in BC.
How to Claim the GST New Home Rebate
There are two ways to claim the GST New Home Rebate:
- Through the builder — Most builders will credit the rebate amount at closing, reducing your purchase price. The builder then files the rebate application with CRA on your behalf.
- Directly with CRA — If the builder doesn't credit the rebate at closing, you can apply directly to the Canada Revenue Agency using Form GST190. You have up to 2 years from the date of purchase to file.
✅ Check Your Contract