Buying your first home in Ontario comes with real financial benefits — but only if you know what they are, how to qualify, and when to use them.
This is a plain-English breakdown of every major first-time home buyer incentive available in Ontario in 2026. No jargon. No fluff. Just what you’re entitled to and how to use it.
Not sure if you qualify as a first-time buyer? Start here first: Who Qualifies as a First-Time Home Buyer in Ontario →
The 5 Major Incentives for Ontario First-Time Buyers
Here’s a quick summary before we go deep on each one:
| Incentive | What You Get | When You Get It |
|---|---|---|
| Ontario Land Transfer Tax Rebate | Up to $4,000 | At closing |
| First-Time Home Buyers’ Tax Credit | $1,500 | Tax return |
| First Home Savings Account (FHSA) | Tax-free savings + withdrawals | Before you buy |
| Home Buyers’ Plan (RRSP) | Up to $35,000 tax-free | Before closing |
| GST/HST New Housing Rebate | Varies | After closing (new builds only) |
1. Ontario Land Transfer Tax Rebate — Up to $4,000
This is the big one for most first-time buyers in Ontario, and it happens at closing — meaning you don’t pay the full land transfer tax out of pocket.
How it works:
Ontario charges a Land Transfer Tax (LTT) when you buy a property. First-time buyers get a full rebate on the first $368,333 of the purchase price, and a partial rebate up to $400,000.
The maximum rebate is $4,000.
What that looks like on a real purchase:
On a $750,000 home in Milton — a realistic entry point for a detached home in Halton Region — your Ontario Land Transfer Tax would normally be approximately $11,475. With the first-time buyer rebate, you get $4,000 back, bringing your actual LTT cost to roughly $7,475.
It’s not nothing. That $4,000 is real money at closing.
Important: If you’re buying in Toronto, there’s also a separate Municipal Land Transfer Tax with its own rebate (up to $4,475). Most Halton Region buyers — Milton, Burlington, Oakville, Halton Hills — only deal with the provincial rebate.
How to claim it: Your real estate lawyer handles this automatically at closing. You don’t need to file anything separately.
Eligibility: You must be a Canadian citizen or permanent resident, at least 18 years old, and a first-time home buyer under Ontario’s definition (not owned/lived in a home in the last four years). The home must be your principal residence.
See the full Ontario land transfer tax breakdown with a worked example →
2. First-Time Home Buyers’ Tax Credit (HBTC) — $1,500
This is a federal tax credit, not a cash payment at closing.
How it works:
You can claim a $10,000 non-refundable tax credit in the year you buy your first home. At a 15% federal tax rate, that works out to $1,500 back on your taxes.
It doesn’t reduce your purchase price or help with the down payment — it’s a tax return boost the year after you buy.
How to claim it: When you file your income tax return for the year of purchase, claim the amount on line 31270 of your T1 return.
Eligibility: You or your spouse/partner must be a first-time home buyer. The home must be in Canada and become your principal residence within one year of purchase.
3. First Home Savings Account (FHSA) — Up to $40,000 Tax-Free
The FHSA is the most powerful planning tool available to first-time buyers — but it only works if you open it before you buy.
How it works:
- Contribute up to $8,000 per year, with a lifetime limit of $40,000
- Contributions are tax-deductible (like an RRSP)
- Withdrawals for a qualifying home purchase are completely tax-free (like a TFSA)
- Unused contribution room carries forward one year
That means the FHSA combines the best of both the RRSP and TFSA. It’s a tax deduction going in and tax-free coming out — but only when used for a first home purchase.
The catch: You need to open the account before you need the money. The sooner you open it, the more contribution room you accumulate. If you’re planning to buy in 1–5 years, open one now — even if you only contribute a small amount to start.
Where to open one: Any major Canadian bank, credit union, or investment platform.
Eligibility: Canadian resident, 18 or older, first-time home buyer (no owned principal residence in the current year or the previous four calendar years).
4. Home Buyers’ Plan (RRSP) — Up to $35,000 Tax-Free
If you already have RRSP savings, the Home Buyers’ Plan lets you borrow from yourself — tax-free — for your down payment.
How it works:
- Withdraw up to $35,000 from your RRSP toward your first home ($70,000 combined for couples)
- No tax withheld at withdrawal
- Repay the amount over 15 years — starting the second year after withdrawal
- If you don’t repay in a given year, that portion gets added to your taxable income
The key question: Do you have RRSP savings to draw on? If yes, this is essentially a 15-year interest-free loan to yourself for your down payment.
How to claim it: Complete CRA Form T1036 and submit it to your RRSP issuer before you withdraw.
Eligibility: First-time home buyer (same four-year rule), Canadian resident, RRSP funds must have been in the account for at least 90 days before withdrawal.
5. GST/HST New Housing Rebate — Varies
This one only applies to newly built homes — either purchased from a builder or self-built.
How it works:
If you buy a new home in Ontario, you pay GST/HST on the purchase. The New Housing Rebate gives you back a portion of that tax, depending on the purchase price.
For homes under $350,000, the federal rebate is up to 36% of the GST paid. The rebate phases out and disappears at $450,000.
Ontario has a provincial portion of the rebate as well — your lawyer or builder will typically work through this with you.
Important note: Most resale homes in Halton Region are exempt from HST. This rebate is primarily relevant if you’re buying from a builder, purchasing a pre-construction condo, or substantially renovating an existing home.
Which Incentives Can You Stack?
Most of these work together. Here’s a realistic example for a first-time buyer purchasing a $750,000 townhouse in Milton, Burlington or Oakville:
| Incentive | Benefit |
|---|---|
| Ontario LTT Rebate | $4,000 at closing |
| First-Time Home Buyers’ Tax Credit | $1,500 on tax return |
| FHSA (if opened in advance) | $8,000–$40,000 tax-free toward down payment |
| Home Buyers’ Plan | Up to $35,000 RRSP withdrawal |
The LTT rebate and HBTC are the automatic ones — every qualifying first-time buyer in Ontario gets these. The FHSA and HBP require planning ahead.
What’s Changed in 2026
A few things worth knowing:
- The federal First-Time Home Buyer Incentive (shared equity program) was cancelled in March 2024. It no longer exists. Some older articles still reference it — ignore them.
- 30-year amortizations are now available for first-time buyers purchasing newly built homes with insured mortgages (less than 20% down). This reduces your monthly payment but increases total interest paid.
- The FHSA is now widely available at all major banks — if you haven’t opened one, 2026 is the year.
FAQs
Can I use both the FHSA and the Home Buyers’ Plan?
Yes. You can use both for the same purchase. Many buyers use their FHSA plus an RRSP withdrawal to maximize their down payment.
Do I get the Ontario LTT rebate automatically?
Yes — your lawyer applies it at closing. You don’t need to claim it separately.
What if my partner isn’t a first-time buyer?
You may lose eligibility for some programs (like the HBP and LTT rebate) but retain eligibility for others. The rules vary by program — worth reviewing your specific situation before closing.
Are these incentives available for condos and townhouses?
Yes. All of the above apply regardless of property type (detached, semi, townhouse, condo) as long as it’s your principal residence.
I’m buying in Milton — does anything change?
The Ontario-level incentives are the same across the province. There are no additional Halton-specific programs at the moment beyond what’s listed above.
Next Step
First-Time Buyer Guide
About This Page
Written by the Roach Family Real Estate Team — Andrew and Lisa Roach, licensed REALTORS® serving Milton, Burlington, Oakville, and Halton Hills. This information is current as of 2026 and is intended as general guidance. Always confirm program details with your lawyer, mortgage broker, or the relevant government agency before making financial decisions.
Part of our First-Time Home Buyer Guide for Ontario →
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