Lately, I have clients (my first time home buyers) asking me the same question repeatedly. The question being," Will I receive my $10,000 grant for buying a new construction when I file my taxes for 2012?"
It was confusing in the beginning how the buyers will be paid $10,000 bonus but here is some information that should help your unanswered questions?
What is the Program?
The BC First-Time New Home Buyers' Bonus is a one-time bonus payment worth up to $10,000 for first-time new home buyers in BC.
Applicants can receive a cheque of up to $10,000, if they qualify, and the amount of the bonus is not taxable.
What is the Eligibility Criteria for Individuals?
First-Time New Home Buyer Qualifications:
- Must be first time home buyers - someone who has never owned a primary residence anywhere in the world.
- The claimant must file a BC resident personal income tax return for 2011 or if the claimant moves to BC after December 31, 2011, must file a 2012 BC resident personal income tax return;
- The claimant must be eligible for the BC HST New Housing Rebate in order to receive the bonus;
- The claimant must intend to live in the house as a primary residence;
- No one else has claimed the bonus in respect of the home.
(If you have filed your 2011 taxes in BC you dont have to wait to apply for the bonus. However, if you have not filed for 2011 taxes as a BC resident or have moved to BC in 2012, then you must file your personal income tax return. Individuals or families who move to BC after December 31, 2012 will not be eligible.)
What is the Eligibility Criteria for Qualified Homes?
- The bonus is available in respect of new homes located in BC (i.e. newly constructed homes purchased from a builder and substantially renovated homes), on which HST is payable;
- A substantially renovated home is one where all or substantially all of the interior of a building has been removed or replaced, generally 90% or more of the home must be renovated to qualify;
- The written agreement of purchase and sale for the home must be entered into on or after February 21, 2012 and before April 1, 2013;
- Ownership or possession of the home must transfer before April 1, 2013;
- Eligible new homes include detached houses, semi-detached houses, duplexes, and townhouses, residential condominium units, mobile homes and floating homes and residential units in a cooperative housing corporation.
How is the Bonus Calculated?
- The bonus is calculated as 5% of the purchase price (not including HST) of the home up to a maximum of $10,000;
- The bonus is income tested. For single individuals, the bonus will be phased out at a rate of 20 per cent of net income in excess of $150,000 and eliminated at incomes greater than $200,000. For couples, the bonus will be phased out at a rate of 10 per cent of family net income in excess of $150,000, and eliminated at family incomes greater than $250,000.
How to Apply?
You must apply to the BC Ministry of Finance to receive the bonus. The ministry will process applications, determine eligibility, and issue the bonus payments. The bonus is not claimed when filing an income tax return.
For more information, click here
Is there is deadline to apply for the bonus?
Your application for the bonus must be filed on or before March 31, 2015.
What forms are required to apply for the bonus?
- FIN 520 - Application for the BC First-Time New Home Buyers' Bonus
- FIN 520A - Schedule A – Certification BC First-Time New Home Buyers' Bonus
(Click on the forms to be directed to the website to download the forms)
What documentation will you need to provide to claim the bonus?
- A copy of your Notice of Assessment of Income Tax for the eligible tax year.
- A copy of your spouse or common-law partner's Notice of Assessment for that year.
- A complete copy of your GST/HST New Housing Rebate Application for Houses Purchased from a Builder (form GST 190) including the GST 190 British Columbia Rebate Schedule (Form RC7190 – BC) or a copy of your GST/HST New Housing Rebate Application for Owner-Built Houses (Form GST 191) including the GST 191 British Columbia Rebate Schedule (Form RC7191 – BC).
- A copy of the final, signed purchase and sale agreement for your eligible new home, and/or the land, mobile home or floating home.
- A copy of the completed and signed Schedule A - Certification BC First-Time New Home Buyers' Bonus (FIN 520A). For each co-owner and/or the spouse or common-law partner of the applicant attach a completed and signed Schedule A – Certification BC First-Time New Home Buyers' Bonus. A completed schedule must be included for the spouse or common-law partner of the applicant even if he or she is not an owner of the home.
If you have any questions, you could contact me or BC Ministry of Finance Directly:
|Telephone:||250 387-3332 or 1-877-387-3332|
|Mail:||BC First-Time New Home Buyers' Bonus
PO BOX 9444 STN PROV GOVT
Victoria BC V8W 9W8
|Courier:||BC First-Time New Home Buyers' Bonus
1st Floor, 1802 Douglas Street
Victoria BC V8T 4K6
Hoping this blog answered a lot of your questions about the BC First-time New Home Buyer's Bonus. For additional information you could vist the BC Ministry of Finance website by clicking here