Good afternoon investors!
I just spent all morning reading CRA documentation and calling them to figure out the step by step logistics.
Here’s what I’ve found:
- I already wrote about how to calculate the rebates here
- Next question is who collects the rebate? The investor!
- According to CRA’s rules, if a new construction residential property is to be a “long-term” rental, the investor is entitled to the same rebates and regular consumers but the investor can not assign the rebates to the builder and must apply for them him/herself.
- Since the builder is losing out on the rebates, they’re going to look for an adjustment from the buyer, so the buyer is going to be out of pocket for the amount of the rebates
- To apply for the rebates, you need a statement of adjustments proving the investor paid the full amount of the HST not adjusted for rebates and a signed lease of 12 month lease or more (that’s enough to be considered long-term i guess)
- ETA is six weeks to get your money back.
- But please note: DO NOT SIGN A LEASE LESS THAN 12 MONTH LEASE or else you void your elligibility for the rebate.Â The first tenant must have a 12 month lease minimum.
- Here are the rebate forms: GST534 and PST RC7000
- For more information, I called this number: 1-800-959-8287 and got a live person after the first ring! Good job CRA!
- Good link to CRA
Hope that clarifies things a bit 🙂
Happy Investing Everyone!
Do you know what happens when you buy a new property from the builder with the intention of living there, and hence assigned your rebates to the builder, but for some reason it hasn’t worked out and you decided to stay in your current home?
If I decide to rent out my new property or sell it after a year or so, what are the HST imlications if any?
Hi Vaishali, unfortunately that is the story dishonest investors who operate in the “grey” will say when CRA comes knocking and even though you intended to live in the new home. Only in renting out the new property would there be implications in regards to the rebates and not in selling. I definitely recommend giving CRA a call if you are in the situation you described.