With the federal government's Home Buyers' Plan, you can use up to $25,000 of your RRSP savings ($50,000 for a couple) to help finance your down payment on a home. To qualify, the RRSP funds you're using must be on deposit for at least 90 days. You must also provide a signed agreement to buy or build a qualifying home. Here are six key questions about the HBP, and answers to help you understand the what, why and how of the plan. | Beginning January 1, 2017, no land transfer tax would be payable by qualifying firsttime purchasers on the first $368,000 of the value of the consideration for eligible homes. Firsttime purchasers of homes greater than $368,000 would receive a maximum refund of $4,000. Limitation The refund will be reduced if one (or more) of the purchasers is not a firsttime homebuyer. The refund will be proportionate to the interest acquired by the individuals who qualify for the refund. | What is the Home Buyers' Tax Credit (HBTC)? Starting in 2009, the federal government introduced a new tax credit, based on a downpayment amount of $5,000, for first time home buyers that buy a qualifying home in the year the home is purchased. How is the new tax credit calculated? The Home Buyers Tax Credit is calculated by multiplying the lowest personal income tax rate for the year (15% in 2009) by $5,000. For 2009, this amount is $750. |
