There's a number that tends to stop custom home conversations cold: the HST bill. On a $900,000 build in Ontario, that's $117,000 in tax before you've planted a single shrub. On a $1.2 million build, it's $156,000. For most families, that number lives somewhere between "I didn't budget for that" and "that changes everything." It's one of the biggest friction points between dreaming about a new home and actually building one. As of April 1, 2026, the Ontario and federal governments are doing something about it — and the window they've opened is worth paying attention to. --- What Was Just Announced On March 25, 2026, Premier Doug Ford announced that Ontario, in partnership with the federal government, will temporarily remove up to the full 13% HST on qualifying new home purchases. This is an expansion of the existing HST New Housing Rebate program, and it applies to purchase agreements signed between April 1, 2026 and March 31, 2027. That's a one-year window. When it closes, so does the rebate — unless it's renewed. The combined federal and provincial tax relief is estimated at approximately $2.2 billion. This isn't a minor adjustment. It's the most significant HST relief measure for new home construction in Ontario's recent history. --- The Full 13% — Not Just the Provincial Portion We've had clients ask this directly, so let's answer it clearly: yes, this is the full 13%. Ontario's HST is made up of the federal 5% (GST) and the provincial 8% portion. Under this program, both are rebated — the federal government has agreed to cost-share their portion alongside the province. You're not getting half a rebate. You're getting the whole thing, up to the applicable limit. --- How Much Can You Get Back? The rebate is tiered based on the fair market value of your new home:
• Under $1,000,000 — Full 13% HST rebated. Maximum rebate: $130,000 • $1,000,000 to $1,500,000 — Maximum $130,000 rebate maintained across this entire range • $1,500,000 to $1,850,000 — Rebate tapers proportionally from $130,000 down to $24,000 (exact taper formula subject to final legislative confirmation) • $1,850,000 and above — Minimum $24,000 rebate (the existing baseline already in place) For most custom home builds in Parry Sound District and Muskoka, the $130,000 ceiling is within reach. That's a number that meaningfully changes what a project costs — and in some cases, what a client can qualify for on a mortgage. --- Who Qualifies? Unlike earlier proposals that were limited to first-time buyers, this expansion applies to all eligible buyers of qualifying new homes. You don't need to be purchasing your first property to benefit. Qualifying scenarios include: • Purchasing a newly built home from a builder • Building your own home on land you own — the owner-builder path • Substantially renovating an existing home (90% or more of the interior) • Purpose-built long-term rental housing (provincial 8% portion removed) One critical point: this rebate applies to primary residences only. If you're building a seasonal cottage, a vacation property, or a short-term rental, the owner-occupied rebate does not apply. A separate New Residential Rental Property rebate exists for qualifying long-term rental builds, but the headline $130,000 rebate is for the home you live in. If that distinction applies to your project, talk to your accountant before building your budget around this program. --- The Part Most People Miss: Owner-Builders and Professional Fees If you own land and are hiring your own contractors to build — rather than purchasing a turnkey home from a developer — you fall into what the CRA calls the "owner-builder" category. This is the most common path for custom home clients we work with in rural Ontario and cottage country. Here's what many people don't realize: the owner-builder rebate doesn't just cover the construction contract. It applies to the HST you paid on your total eligible build costs, which under CRA rules includes: • Contractor and trade labour • Building materials • Professional design and architectural fees • Permit fees where HST was charged That means the HST on your design drawings, your permit application, and your site consultations can all be part of your rebate claim when you file with CRA. We still charge HST on our services as required — nothing changes there. But what changes is that you now have a much stronger program to recover it through, alongside everything else you spent to build your home. ---
Why April 1 Is a Real Deadline The expanded rebate applies to purchase agreements — and in the owner-builder context, construction contracts — signed on or after April 1, 2026. Agreements signed before that date stay under the existing rules. If you're planning a build this spring or summer, that date matters. Getting your design agreement and contracts in place inside the window puts your project inside the rebate program for its full one-year term. We're not suggesting rushing a decision you're not ready to make — but if you've been close to moving forward, this is a concrete financial reason not to let spring slip by. --- A Few Things to Know Before You Count On It We'd rather give you the honest picture than the optimistic one: • It's a rebate, not an upfront exemption. You pay the HST during the build, then claim it back. Make sure your construction financing accounts for that timing. • The legislation still needs to formally pass at both provincial and federal levels. It's broadly expected to, but treat it as confirmed upside once your lawyer verifies current status — not as a guarantee when you're qualifying for a mortgage. • Owner-builders have up to two years from the date of first occupancy to file their claim with CRA. • If buying from a builder, read the HST clause in your contract carefully. Builders often assign the rebate to themselves and credit it against the purchase price. Your lawyer needs to walk you through exactly who is claiming what before you sign. • Get your accountant involved early. The eligibility rules — especially around primary residence and contract timing — have real consequences if they're not met. --- The Bottom Line For anyone planning a new custom home build in Ontario, the April 1, 2026 to March 31, 2027 window is a genuinely significant opportunity. Up to $130,000 back changes project math in ways that are worth sitting down to calculate. At BrambleRidge Home Design Group, we've been doing this work in Parry Sound District and Muskoka long enough to know that the projects that go smoothly are the ones that started with the right plan. If a new build has been in the back of your mind, now is a good time to move it to the front. Reach out to our team to start the conversation. --- This article is for general information purposes only and does not constitute legal or tax advice. Eligibility rules, timelines, and program details are subject to legislative confirmation. Consult a qualified accountant or tax lawyer for advice specific to your situation. ---
