Ontario Home Buyer Incentives (2026)

Updated: April 2026

By Françoise Pollard, Realtor®, and Keith Goldson, Broker, Keith & Françoise Real Estate Team, eXp Realty Brokerage. We advise buyers across the GTA and Niagara Region on incentive eligibility and savings strategy. Our goal is making sure clients understand the full picture before they commit to a purchase.

These programs fall into three categories: tax-advantaged savings accounts that help fund a down payment, tax credits claimed after purchase, and rebates applied at closing or through tax filings. Each works differently. Knowing which ones apply before you start searching changes how you save, how you structure your closing funds, and how much you actually pay to buy.

The buyers who benefit most from Ontario home buyer incentives plan around them before the offer. Those who discover them after closing rarely get to use them fully.

Incentives do not make a bad purchase good. They make a well-planned purchase cheaper.

For the full buying process and how incentives fit into financing strategy, see our complete guide to buying a home in Ontario. For the first-time buyer process from start to finish, see our first-time home buyer guide for Ontario.

First Home Savings Account (FHSA)

The FHSA is the most powerful home buyer incentive available to Ontario buyers right now. It combines the tax deduction benefit of an RRSP with the tax-free withdrawal benefit of a TFSA. Both benefits apply, but only for qualifying first home purchases.

How it works

You can contribute up to $8,000 per year to a lifetime maximum of $40,000. Contributions reduce your taxable income in the year you make them. When you withdraw to purchase a qualifying first home, the withdrawal is completely tax-free with no repayment requirement. You can carry forward up to $8,000 of unused contribution room from the prior year. Limits are unchanged for 2026.

When to open it

The FHSA is most effective when opened early. Buyers who open one years before purchasing benefit from tax-free compounding growth over the full period. Contribution room starts accumulating from the year the account is opened, not the year you first contribute. Opening it costs nothing and there is no obligation to contribute immediately. Buyers who wait until they are actively searching leave years of tax-free growth on the table.

If you are more than 12 months from buying and have not opened an FHSA yet, open one now. The tax deduction this year plus the compounding growth between now and your purchase adds up to a meaningful difference at closing.

Who should not rely on the FHSA

The FHSA is only useful if you are genuinely a first-time buyer and plan to purchase within 15 years of opening the account. If you do not end up purchasing a qualifying home, withdrawals are not tax-free and the account must eventually be closed or transferred. Buyers who open an FHSA assuming they will qualify, without confirming their first-time buyer status first, sometimes discover a disqualifying ownership in their history only when the lawyer asks the question. Confirm your eligibility before you open the account and start contributing.

RRSP Home Buyers’ Plan

The Home Buyers’ Plan allows eligible buyers to withdraw up to $60,000 per person from their RRSP toward a qualifying first home purchase. For couples who both qualify, that is $120,000 combined available toward the down payment.

Repayment rules

Unlike the FHSA, HBP withdrawals must be repaid to your RRSP over 15 years. If you miss a repayment in any year, CRA adds that amount to your taxable income for that year. The repayment obligation starts two years after the year of withdrawal.

The 90-day rule

Funds must have been in your RRSP for at least 90 days before you withdraw them under the HBP. Contributing $50,000 to your RRSP in January and withdrawing it in March under the Home Buyers’ Plan does not satisfy the rule. Plan accordingly if you are topping up your RRSP specifically for this purpose.

Using the FHSA and Home Buyers’ Plan Together

Eligible buyers can use both programs for the same purchase. A buyer with $40,000 in an FHSA and $60,000 in eligible RRSP savings can access up to $100,000 toward their down payment. The FHSA withdrawal comes out tax-free with no repayment. The HBP withdrawal must be repaid over 15 years.

This combination is one of the most underused home buyer incentives Ontario has to offer right now. Most buyers know one or the other exists. Far fewer have opened both accounts, contributed to both, and planned to use both strategically for the same purchase. For buyers two to four years from purchasing, the tax deductions on FHSA contributions plus tax-free compounding across both accounts can meaningfully increase the down payment available at closing.

Program	Max per person	Repayment	Tax on withdrawal
FHSA	$40,000 lifetime	None required	Tax-free
Home Buyers’ Plan	$60,000	Over 15 years	Tax-free at withdrawal

Ontario Land Transfer Tax Refund for First-Time Buyers

Ontario offers a land transfer tax refund of up to $4,000 for eligible first-time buyers. On purchases priced below $368,333, this eliminates the provincial land transfer tax entirely. On higher-priced homes, the $4,000 refund applies and the buyer pays the balance. Your lawyer applies the refund at closing, provided eligibility requirements are met.

The eligibility trap most couples miss

Qualifying for the Ontario land transfer tax refund requires that you have never owned a home anywhere in the world. If your spouse or common-law partner has previously owned a home anywhere in the world, including outside Canada, neither of you qualifies. This rule catches many buyers off guard, particularly those purchasing with a partner who owned property in another country before coming to Canada. Discover this the week before closing and it is too late to act. It belongs in the planning stage.

Toronto Municipal Land Transfer Tax Rebate

Buyers in Toronto pay a second land transfer tax on top of the provincial amount. Eligible first-time buyers may qualify for a municipal rebate of up to $4,475 on that second tax. Your lawyer applies both the provincial and municipal rebates at closing at the same time.

Combined, a qualifying first-time buyer purchasing in Toronto can receive up to $8,475 in land transfer tax relief between the two programs. On a $700,000 purchase in Toronto, that saving belongs in your closing cost planning from day one.

Home Buyers’ Amount Tax Credit

The Home Buyers’ Amount is a federal non-refundable tax credit worth $10,000. At the 15% federal tax rate, a $10,000 claim translates to up to $1,500 in federal tax relief. You claim it on your personal income tax return in the year you purchase. Both partners in a couple purchasing together can split the claim as long as the combined total does not exceed $10,000.

This is not a cash payment at closing. It reduces the income tax you owe when you file. Non-refundable means it reduces your tax to zero. It does not generate a refund if the credit exceeds your tax payable for the year. It was doubled in December 2022 and has remained at $10,000 since.

GST/HST New Housing Rebate

HST does not apply to resale homes in Ontario. It applies to newly built homes and substantially renovated properties. On a new build in Ontario, the combined HST rate is 13%: 5% federal GST plus 8% provincial. On a $700,000 new build, that is $91,000 in HST before any rebate.

The GST/HST New Housing Rebate offsets a portion of that cost for qualifying purchases. Its federal component applies in full on homes under $450,000 and phases out above that threshold. Ontario has a separate component with its own eligibility rules. How you use the property and how the purchase is structured both affect eligibility. Confirm the full rebate calculation with your lawyer and builder before closing, not after.

Programs No Longer Available

CMHC discontinued the Canada First-Time Home Buyer Incentive shared-equity program in March 2024. It no longer accepts applications. Do not include it in your planning. Any resource that still lists it as an available home buyer incentive in Ontario is out of date. When reviewing Ontario home buyer incentives, always confirm the program is currently active before counting on it.

The Eligibility Traps Most Buyers Miss

Most problems with home buyer incentives in Ontario do not come from missing a program. They come from timing and eligibility assumptions that turned out to be wrong. Understanding your eligibility before you start searching lets you structure your savings and closing funds accurately from the start.

The land transfer tax refund and past homeownership

The Ontario land transfer tax refund is the one most often lost to eligibility issues discovered late. A partner who owned a home abroad, a forgotten previous ownership, or a misunderstanding of the eligibility rule: each has cost buyers a refund at the worst possible time. Confirm eligibility with your lawyer at the start of the process, not the week before closing.

FHSA accounts opened too late

Contribution room in an FHSA accumulates from the year the account is opened. Buyers who open one in January of the year they purchase get one year of room. Buyers who opened one three years earlier have accumulated $24,000 in room. The account costs nothing to open and has no contribution obligation. Waiting until you are ready to buy is the most common way buyers leave this incentive underused.

HBP withdrawals before the 90-day holding period

Topping up an RRSP and withdrawing it under the Home Buyers’ Plan within 90 days does not qualify. The funds must have been in the RRSP for at least 90 days before withdrawal. Plan the timing of any RRSP top-up with this rule in mind. This is especially important if you are maximising your HBP withdrawal before a spring purchase.

Returning buyers have access to different programs once they have owned before. See our guide to Ontario home buyer programs for returning buyers: different programs apply and the eligibility rules shift.

When Incentives Should Not Drive Your Decision

Programs and rebates are planning tools. They are not a reason to buy something you are not ready for, at a price that does not work, or on a timeline that does not suit your financial position. There are situations where the programs are largely irrelevant to the decision in front of you.

When the property does not qualify. Some programs, particularly the GST/HST New Housing Rebate and certain CMHC rules, are property-specific. A resale home and a new build are treated completely differently. An investment property disqualifies you from several programs entirely. Understand what the property type means for your eligibility before you count any program in your numbers.

When you are not a first-time buyer. The land transfer tax refund, the FHSA, and the Home Buyers’ Plan all require first-time buyer status under their respective definitions. If you have owned before, most of these programs do not apply. Buying with a partner who has owned before compounds this. A program that does not apply to you is not a saving. It is simply not relevant to your purchase.

When the numbers only work because of the incentive. If your purchase is affordable only because you are counting on a $4,000 land transfer tax refund or $1,500 tax credit to make the closing costs work, the purchase is not as solid as it looks. Incentives should improve a purchase that already works. They should never be the thing that makes it work.

Knowing when a program does not apply to you is as valuable as knowing when it does.

Program rules, eligibility thresholds, and contribution limits can change. This article reflects program details as of April 2026. Confirm current eligibility requirements and limits directly with your real estate lawyer or a qualified financial advisor before making decisions based on any incentive program.