Canada Removes GST On New Rental Construction: Who Qualifies?

In recent reports emerging in Canadian GST news, the country’s federal government announced that they’d be removing the Central Goods and Services Tax/Harmonized Sales Tax (HST) on all henceforth housing projects. This Canada housing news would be applicable on all qualifying properties effective on Sep 14, 2023.

The move comes in the footsteps of the ever-growing housing crisis in Canada. As we mentioned in our former articles, Canada is currently struggling to house its international students. This removal comes as a method to help resuscitate and revitalise the country’s purpose-built student housing (PBSA), student housing as well and senior housing sector, meant specifically for long-term constructions. The Canada GST rules have been a hurdle for many property planners for some time, especially in the face of the housing crisis Canada. Therefore, it comes as a relief.

Who qualifies?

While there haven’t been any releases regarding the qualification requirements, the federal government has made it clear that the property needs to cater to the PBSA, senior housing, and student housing sectors. Additionally, the building must qualify for the already existing rebate  This rebate wouldn’t qualify for individually-owned condominiums, single-unit housing, duplexes, triplexes, and housing co-ops. If property owners are planning to significantly renovate already existing properties to qualify for the updated rebate, we are sorry to be the bearers of bad news: they wouldn’t qualify either.

This rebate means that property owners would be making significant savings. Especially in British Columbia, the GST removal would mean about 5% savings. The rising cost of land is mostly due to the inflating costs caused by the housing crisis Canada, meaning the Canadian GST news can help the builders finally lift their projects off the ground. The move arrives after months of pressure on the federal government to make some reforms. The government has encouraged all provinces to follow its lead. If one takes a look at Ontario, the 13% GST includes 8% provincial sales tax and 5% federal tax. Therefore, the move would mean a massive upheaval of about 13% savings. Tune in for more updates. 

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Are you a property owner looking to secure your landlord insurance? Check out our guide to HMO Landlord Insurance. List with amber to stay up to date with the recent happenings in the world of student accommodation.

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