The First-Time Home Buyers' Tax Credit (HBTC) is a federal non-refundable tax credit available to Canadians who purchase their first home. The credit amount is $10,000, which at the 15% federal tax rate translates to a $1,500 reduction in federal income tax in the year you purchase. You claim it on line 31270 of your T1 general return — no application, no CRA registration, just the line on your taxes. For GTA buyers already stretching their budget on a first purchase, $1,500 returned through your tax refund is a welcome addition on top of the other programs available to first-time buyers.
The HBTC is one of several programs available to first-time buyers in Ontario. For the complete picture — including the FHSA, the Home Buyers' Plan, and land transfer tax rebates — see first-time home buyer benefits in Ontario.
How the Tax Credit Works
A non-refundable tax credit reduces your federal income tax owing — but only up to the amount of tax you actually owe. It cannot create a refund beyond what you've already paid through payroll deductions or installments.
The calculation: $10,000 × 15% (the base federal tax rate) = $1,500 in federal tax savings.
Example: You purchase your first home in 2025 and file your T1 in spring 2026. You've had $12,000 withheld from your paycheques in 2025 and your total federal tax owing (before credits) is $11,000. The HBTC reduces your tax owing by $1,500, to $9,500 — so you receive a refund of $2,500 ($12,000 paid minus $9,500 owing). The HBTC contributed $1,500 of that refund.
If your total federal tax owing is less than $1,500 (for example, you have low income or other significant credits), the HBTC will reduce your tax to zero but cannot generate a refund beyond that — it's non-refundable.
Who Qualifies for the HBTC
To claim the First-Time Home Buyers' Tax Credit:
- You must be a Canadian resident at the time of purchase
- You (or your spouse or common-law partner) must not have owned a qualifying home that you occupied as your principal residence at any time in the year of purchase or in the preceding 4 calendar years
- The home must be a qualifying home — a housing unit in Canada (house, condo, townhouse, mobile home) that you intend to occupy as your principal residence within one year of purchase
- The purchase agreement must have been completed (you must have acquired the home, not just signed a pre-construction agreement)
The 4-year rule means repeat first-time buyers — those who haven't owned a principal residence in the past 4+ calendar years — can qualify again. If you owned a home but sold it 6 years ago and haven't owned since, you likely qualify today.
Claiming the Credit — Joint Purchases
If you're purchasing with a spouse or common-law partner, you can split the $10,000 credit between your two returns. The combined claim cannot exceed $10,000. Splitting makes sense when one partner has enough federal tax owing to use the full credit — if your tax savings are limited by low income on one return, splitting the credit with the higher-income partner captures more of the $1,500 benefit.
Both you and your co-purchaser must independently qualify as first-time buyers for each to claim any portion of the credit. If one of you previously owned a home (in the last 4 calendar years), that person cannot claim the HBTC for this purchase, though the qualifying partner can still claim their share.
How to Claim It on Your T1
- File your T1 general return for the year in which you completed the home purchase
- Enter $10,000 on line 31270 ("Home buyers' amount") of your return
- Your tax software (or accountant) calculates the resulting $1,500 credit automatically
- No receipts or supporting documents need to be filed with CRA — but keep your purchase documents in case of a review
The claim is made in the tax year when the home is acquired — generally when the closing date occurs and title transfers to you. For a home purchased in December, it's claimed on that year's return even if you moved in January. See CRA's guidance on line 31270 for the official eligibility criteria.
HBTC vs. Other First-Time Buyer Programs
| Program | Benefit amount | When you receive it |
|---|---|---|
| Ontario LTT rebate | Up to $4,000 | At closing (reduces tax owing) |
| Toronto MLTT rebate | Up to $4,475 | At closing (reduces tax owing) |
| First-Time Home Buyers' Tax Credit | $1,500 federal tax savings | When you file your taxes that year |
| FHSA (First Home Savings Account) | Tax deduction + tax-free growth | Deduction in contribution years; withdrawal at purchase |
| Home Buyers' Plan (HBP) | Up to $60,000 RRSP withdrawal | Tax-free at withdrawal; repay over 15 years |
The HBTC is the simplest program — one line on your tax return, no application, no ongoing obligations. It stacks on top of all other first-time buyer programs. Use it every time you qualify, as it costs nothing to claim and the $1,500 savings require no action beyond filing your taxes as normal.
Ready to find your first home in the GTA? Browse active listings on Condohill and factor the HBTC and other first-time buyer savings into your total budget.
FAQ
How much is the first-time home buyer tax credit in Canada?
The First-Time Home Buyers' Tax Credit is a $10,000 non-refundable federal tax credit. At the 15% base federal tax rate, this reduces your federal income tax owing by $1,500 in the year of purchase. It's claimed on line 31270 of your T1 general return.
Is the first-time home buyer tax credit refundable?
No. The HBTC is a non-refundable credit, meaning it can reduce your federal tax owing to zero, but it cannot generate a tax refund beyond what you've already paid. If you owe less than $1,500 in federal tax for the year, you only benefit up to the amount of tax you actually owe.
Can both spouses claim the first-time home buyer tax credit?
Yes, but the combined total cannot exceed $10,000. Both spouses or common-law partners can split the $10,000 credit in any proportion that adds up to $10,000, as long as both individually qualify as first-time buyers. Each partner's share is claimed on their own T1 return on line 31270.
Can I claim the HBTC if I bought a pre-construction condo?
You can claim the HBTC in the year the home is acquired — meaning the year the purchase legally closes and title transfers to you, not the year you signed the pre-construction purchase agreement. For a pre-construction condo signed in 2022 that closes in 2026, claim the credit on your 2026 T1 return.
Does the HBTC apply to condos and townhouses?
Yes. The HBTC applies to any qualifying home in Canada — detached houses, semi-detached houses, townhouses, condos, mobile homes — as long as it becomes your principal residence within one year of purchase and you otherwise qualify as a first-time buyer.