New Ontario Harmonized Sales Tax

The Ontario Provincial Government intends to combine the 8% provincial sales tax with the 5% federal Goods and Services Tax for a combined 13% Harmonized Sales Tax (HST).

 

The effective date for the new HST is to be July 1st, 2010 with various transitional rules to apply around that date.

 

Although the HST will not apply directly to the purchase price of re-sale homes, it will add to the cost of buying as it will apply to services such as moving expenses, legal fees, home inspection fees and realtor commissions.

 

The HST will apply to the purchase price of newly constructed homes although the Province is proposing a rebate. The proposed rebate would apply across all price ranges on the first $400,000 of the purchase price. The proposal provides a 75% rebate on the provincial portion of the HST which for new homes under $400,000 would mean no additional tax amount compared to the current system.

 

For transitional rules please call the provincial government enquiry line at 1-800-337-7222 or visit the government web site.

Leslie Weir

Leslie Weir

Sales Representative
CENTURY 21 Leading Edge Realty Inc., Brokerage*
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