As a first-time home buyer in Canada you may be eligible to take advantage of two great money-saving benefits.
The First-Time Home Buyers’ Tax Credit (HBTC) was introduced by the federal government to help Canadians purchase their first home or to get back into the housing market. The credit amount is determined by multiplying the lowest personal federal income tax rate for the year (15% in 2016) by $5,000. For 2016, the total allowable credit is $750.
The HBTC is non-refundable, which means it can only be used to reduce the amount of tax you may owe. The credit should be claimed on your federal income tax return.
You are eligible for the HBTC if:
Learn more at http://www.cra-arc.gc.ca/hbtc/.
The Home Buyers’ Plan (HBP) allows you to withdraw money from your Registered Retirement Savings Plans (RRSPs) tax-free to help with the purchase of your first home.
Here are some of the conditions for participating in the HBP:
RRSP withdrawal limits and details:
To learn more about HBP features and eligibility requirements, visit the Canada Revenue Agency (CRA) website.
For strategies on how to get the most out of your RRSP—and to make sure it’s a good option for you—speak with a financial advisor.
You may also want to contact a Mortgage Specialist to make sure you’re taking advantage of all the benefits available to you as a first-time home buyer.