First-Time Homebuyer Tax Benefits in Ottawa: What Still Exists in 2026

Most of the first-time buyer checklists circulating online are out of date in two directions at once. They still list a federal shared-equity program that stopped accepting applications in 2024, and they miss a GST rebate worth up to $50,000 that arrived in 2025. They also tend to quote an RRSP withdrawal limit that is $25,000 too low.

Here is what an Ottawa buyer can actually use in 2026, what the eligibility rules genuinely say, and the order to use them in.

The programs, current status

The First-Time Home Buyer Incentive is worth naming explicitly because it is still the first result on a lot of searches. CMHC stopped accepting applications on 21 March 2024 and granted no new approvals after 31 March 2024. If a broker or a blog is still building your down payment plan around it, the plan is wrong.

“First-time buyer” does not mean the same thing in each program

This is where most claims fail, and it is the single most useful thing to know before you start. The definitions genuinely differ.

For the Home Buyers’ Plan, you are a first-time buyer if you did not live in a qualifying home that you or your current spouse or common-law partner owned, as your principal residence, at any time in the current calendar year (other than the 30 days immediately before the withdrawal) or in the preceding four calendar years. Two consequences follow. You can be a first-time buyer more than once in a lifetime. And your spouse’s ownership disqualifies you even if your name was never on the title. The CRA sets the test out in full on the Home Buyers’ Plan page.

For the Ontario land transfer tax refund, the test is far stricter: you cannot have owned a home or an interest in a home anywhere in the world, and neither can your spouse while they were your spouse. There is no four-year reset. A property inherited overseas a decade ago ends the claim.

For the first-time home buyers’ GST/HST rebate, there is a separate test again, with its own conditions about who has to occupy the home and when. Check it against the CRA’s eligibility page rather than assuming the HBP answer carries over.

Qualifying for one does not qualify you for the others. Check each separately.

The FHSA and the HBP work together

You can use an FHSA withdrawal and a Home Buyers’ Plan withdrawal for the same purchase, provided you meet the conditions of each at the time of each withdrawal. That is the single largest structural change in first-time buyer planning since the FHSA launched, and a surprising number of people still believe it is one or the other.

The order to fill them matters, and it is not close.

Do you have RRSP room and FHSA room?
├─ FILL THE FHSA FIRST.
│  Contributions are deductible AND qualifying
│  withdrawals are never repaid. It is the only
│  registered account that is deductible in and
│  tax free out.
│
└─ Then, if you need more down payment:
   │
   Use the HOME BUYERS' PLAN for the balance.
   ├─ Up to $60,000 per person, so $120,000 for
   │  a qualifying couple.
   └─ But it is a LOAN from your own retirement
      savings. You repay it over 15 years and the
      money is out of the market meanwhile.

The FHSA is deductible on the way in like an RRSP and tax free on the way out like a TFSA, with no repayment. The mechanics, including the deadline to open one and the rules on unused room, are in the first home savings account. If you are still deciding how to allocate savings generally, the framing in TFSA vs RRSP applies here.

The Home Buyers’ Plan repayment, precisely

The limit is $60,000 per person. That figure has been in place since the 2024 increase and it is still routinely reported as $35,000.

Repayment runs over 15 years. Normally the first repayment year is the second calendar year after the withdrawal. There is a temporary deferral for anyone whose first withdrawal falls between 1 January 2022 and 31 December 2025: the 15-year period starts in the fifth year following the withdrawal instead. A first withdrawal in 2022 means the first repayment year is 2027. The CRA sets the schedule out in how to repay the HBP.

The trap is what happens when you miss a repayment. The shortfall is not a penalty. It is added to your taxable income for that year, at your marginal rate, and the RRSP room is gone permanently. On a $60,000 withdrawal the annual repayment is $4,000, which is easy to forget and expensive to forget twice. More detail in the RRSP Home Buyers’ Plan.

The home buyers’ amount is smaller than people expect

Line 31270 lets you claim $10,000 for a qualifying home. That is the claim amount, not the refund. It is a non-refundable credit, valued at the lowest federal personal income tax rate, and that rate is 14% for 2026 after the reduction from 15%. Two eligible purchasers can split the claim but the total across everyone cannot exceed the maximum for the home.

So this is a modest benefit, and it is non-refundable, meaning it reduces tax you owe and produces nothing if you owe nothing. Claim it, but do not build a budget on it. The current amount and conditions are on the CRA’s line 31270 page.

The new GST rebate, if you are buying new

This is the largest single item on the list, and it only applies to new construction. The first-time home buyers’ GST/HST rebate removes the GST, or the federal portion of the HST, on a new home valued up to $1 million, and reduces it on a proportional basis between $1 million and $1.5 million. The maximum is $50,000. Finance Canada announced it in May 2025.

The timing conditions are strict and they bite in Ottawa, where a lot of new inventory was pre-sold years before completion. For a purchase from a builder, the agreement must have been entered into on or after 20 March 2025 and before 2031, with construction substantially completed before 2036. For an owner-built home, construction must begin on or after 20 March 2025. There is generally a two-year window to apply after you take ownership.

This rebate sits alongside, and does not replace, the general GST/HST new housing rebate, and Ontario runs its own provincial new housing rebate against the 8% provincial portion of the HST. A new build in Ottawa can involve all three, which is worth having a professional check rather than trusting the builder’s summary sheet.

Buying resale? None of this applies. Resale housing is not subject to GST/HST in the first place.

Ontario land transfer tax, and what Ottawa avoids

Ontario charges land transfer tax on every purchase. First-time buyers get a refund of up to $4,000, which means no provincial LTT on the first $368,000 of consideration and the full $4,000 refund on anything above that, per the Ontario rules. Given Ottawa prices, effectively every qualifying buyer receives the full $4,000 and nothing more.

You have 18 months from registration to claim it, and the refund is proportionate if a co-purchaser is not a first-time buyer. A parent added to title to help with financing cuts the refund in half.

The good news is what Ottawa does not have. The municipal land transfer tax that adds a second, roughly equivalent bill applies in Toronto and not here. Budget the provincial tax only, using the bracket structure the refund is applied against in Ontario land transfer tax, because the refund caps out long before the tax does and the balance is cash you need at closing.

The order to do this in

1. Open an FHSA now, even with a small deposit, because opening it starts the room accumulating.
2. Confirm your first-time status separately against each program’s own test.
3. Fill the FHSA before touching RRSP savings.
4. If you need more, use the Home Buyers’ Plan, and diarise the repayment.
5. If you are buying new, confirm the agreement date against the 20 March 2025 threshold before you count on the GST rebate.
6. Have your lawyer file the Ontario land transfer tax refund at registration.
7. Claim line 31270 on the return for the year of purchase.

Two more things worth knowing once you own. Your home is generally covered by the principal residence exemption, so the gain on sale is normally tax free, and mortgage interest on a personal residence is not deductible in Canada despite what US content suggests. The narrow circumstances in which interest does become deductible are set out in mortgage interest deductibility.

If you are buying in Ottawa this year and want the withdrawal sequencing and the rebate eligibility checked before you sign an agreement rather than after, that is a short conversation worth having.