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Key Points to Understand About HST for Real Estate

By
Real Estate Broker/Owner with Envelope Real Estate Brokerage Inc

Home buyers and even some new home builders and renovators could be under the impression that any contracts entered into before July 1 will not be affected with HST.

Not so!

Here are some key points to understand:

  • Determining whether HST applies to a new home purchase is based on the date of transfer of ownership or possession.
  • The amount of the HST depends on the price of the home. For homes under $400,000 HST will apply. Currently every home has a provincial tax of 2% included.In Ontario, there is the Ontario Housing Rebate so you may not see an increase in tax on new homes, there will still be the same 2%
  • If construction of a house is 85% complete on July 1, a rebate of 85% of the 2% would be payable.

Sound confusing? Watch for a simplified explanation  and a few examples that I will post over the next few months.  In the meantime, feel free to contact me and I will try to un-confuse you ,( I don't know if there is such a word as un-confuse, but what the heck, if the beaurocrats  can create confusion, so can I)

Posted by

Ty Lacroix Broker of Record & Owner

          

'NOT ALL REALTORS* ARE THE SAME', One call or email to me and you will know why!

Your London and S/W Ontario source for results!

519-435-1600   www.enveloperealestate.com

Comments (10)

Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

What's HST?

Feb 11, 2010 06:21 AM
Larry Estabrooks
Independent Real Estate Agent - Moncton, NB
100% representation means NEVER DUAL AGENCY !

Horrible Sales Tax!

(Harmonized Sales Tax- so called because it is comprised of federal sales tax and and provincial (state  to Americans) sales tax that is collected harmoniously by every tax registrant citizen and corporation and remitted by them to the federal government who then sends the various provincial (state) governments their share.

Feb 11, 2010 06:29 AM
Ty Lacroix
Envelope Real Estate Brokerage Inc - London, ON

Hi Lenn

This is the harmonized sales tax which will combine the provincial sales tax with the federal sale tax and allow businesses to file once and not twice.

Not to sound flippant, I understand that the thickness of the regulations regarding HST is 17.9 " thick.

Be thank full that HST applies only in Canada.

Ty

Feb 11, 2010 06:30 AM
Ty Lacroix
Envelope Real Estate Brokerage Inc - London, ON

Larry:

I like your wording harmoniously. I think in the southern US they call it whistlin' Dixie.

Ty

Feb 11, 2010 06:33 AM
Malcolm Johnston
Century 21 Lanthorn Real Estate LTD., Trenton, Ontario - Trenton, ON
Trenton Real Estate

Thanks Ty, I'm not sure that very many people understand this new HST and the multitude of implications it's going to have. Revenue neutral my fanny.

Feb 11, 2010 06:41 AM
Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

Thanks.  I am indeed thankful.

 

Feb 11, 2010 07:38 AM
Ty Lacroix
Envelope Real Estate Brokerage Inc - London, ON

Malcolm: I and most agree that there will be a multitude of implications.

Lenn: Our pleasure

Ty

Feb 11, 2010 10:09 AM
FN LN
Toronto, ON

Ty - Although HST only applies in Canada, some American and other foreign companies are registered to charge GST, HST, QST and/or PST on shipments to Canada.  In some cases, they voluntarily register and in other cases, they are forced to register by Canada Revenue Agency.

I always find it a lot of fun to explain the various Canadian tax systems to Canadians, Americans and other people around the world.

Feb 11, 2010 04:15 PM
Bob Dunn
Sutton Group West Coast Realty - Abbotsford, BC

I'll pay attention to your posts. Gaining a firm understanding of the HST has been on my to-do list for a long time.

Feb 11, 2010 05:03 PM
Ty Lacroix
Envelope Real Estate Brokerage Inc - London, ON

Marc: Great to know, I will pass them over to you. LOL!

Bob: My intention is to clarify the HST and applications, but its like trying to walk on water. I can't!

Ty

Feb 12, 2010 02:21 AM