Are there any HST rebates available when purchasing a new commercial property?

In Canada, the Harmonized Sales Tax (HST) rebate for new commercial properties is available under specific conditions.

The rebate is designed to help recover a portion of the HST paid on the purchase or construction of a new commercial property.

Here are the key points to consider:

1. Eligibility for the HST Rebate - The rebate applies to the purchase or construction of a new commercial property (e.g., office buildings, retail spaces, industrial properties). - The property must be used primarily (90% or more) for commercial activities. - The rebate is not available for residential properties, though there is a separate GST/HST New Housing Rebate for residential properties.

2. Rebate Amount - The federal portion of the HST (5% GST) is generally not eligible for a rebate on commercial properties. - The provincial portion of the HST (which varies by province, e.g., 8% in Ontario, 10% in Nova Scotia) may be eligible for a rebate, depending on the province and the use of the property. - The rebate is typically 75% of the provincial portion of the HST, up to a maximum amount.

3. How to Claim the Rebate - The rebate is claimed by filing a GST/HST Rebate Application with the Canada Revenue Agency (CRA). - The application must include supporting documentation, such as the purchase agreement, proof of payment, and details of the property's use. - The rebate must be claimed within two years of the date the HST was paid.

4. Important Considerations - If the property is used for both commercial and residential purposes, the rebate may be prorated based on the percentage of commercial use. - If the property is later converted to residential use, additional tax implications or rebate adjustments may apply. - It’s advisable to consult with a tax professional or accountant to ensure compliance and maximize rebate eligibility.

5. Provincial Variations - The availability and amount of the rebate may vary depending on the province. For example: - In Ontario, the provincial portion of the HST is 8%, and the rebate is 75% of that amount. - In Nova Scotia, the provincial portion is 10%, and the rebate is similarly calculated.

If you’re purchasing or constructing a new commercial property, it’s important to review the specific rules and consult with a tax professional to determine your eligibility and the exact rebate amount.

Moe and Maher Dib | CITYVIEW Realty Inc., Mississauga

Your Trusted Real Estate Advisors. Your Dream, Delivered.

Moe Dib, Realtor (647) 500.2214

[email protected]

Maher Dib, Realtor (647) 405.2214

[email protected]

www.cityviewrealty.ca

www.cityviewcondos.ca