taxes. Don't you just love them. As you may or may not know, the
Harmonized Sales Tax (HST), combining the 7% provincial sales tax (PST)
and 5% federal goods and services tax (GST), is coming into effect on
July 1, 2010.
Here's a general overview of some of the effects the HST will have on your Real Estate transactions post July 1.
Real estate services (my commission) will be subject to the HST. Currently, real estate services are only subject to GST.
Similar to the GST, the HST will only apply to the sale of new or substantially renovated homes. Substantially renovated homes are homes with additions or major renovations completed on at least 90% of the property.
In general, buyers of new homes priced at up to $525,000 will be eligible for a new rebate of 71.43% on the provincial portion (7% of the HST's 12%) of the HST paid. Purchasers of new homes priced at $4525,000 or above will be eligible for a flat rebate of $26,250. These rebates are in addition to the new housing rebates already available under the GST, however unlike the GST rebates, the new provincial HST rebate will not be eliminated for higher priced homes.
I hope that helps clarify some of the implications of the HST for you (clear as mud). If you have any questions, feel free to call or email me.