Home Buyers' Tax Credit: $1,500 Back on Your Tax Return

The HBTC at a Glance

Who gets it: First-time home buyers or buyers with disabilities.
How much: Up to $1,500 reduction on federal taxes owed.
How to claim: Line 31270 on your T1 income tax return.

What is the Home Buyers' Tax Credit?

The Home Buyers' Tax Credit (HBTC) is a federal non-refundable tax credit available to eligible first-time home buyers in Canada. It was introduced by the federal government to help offset the closing costs associated with purchasing a home for the first time. The credit was enhanced in the 2022 federal budget from $750 to $1,500 in tax relief.

While it may seem small compared to the HST rebate or FHSA advantages, the HBTC is essentially "free money" — eligible buyers who don't claim it are simply leaving $1,500 on the table at tax time.

Who Qualifies for the HBTC?

You qualify for the HBTC if you meet one of the following criteria:

First-time home buyer: You (or your spouse/partner) have not owned and lived in another home in the current year or any of the preceding four years.
Buyer with a disability: You or a related person with a disability acquired the home for the purpose of allowing the person with a disability to live in a more accessible space. In this case, the first-time buyer restriction does not apply.

The home must be a qualifying home located in Canada, registered in your name or your spouse's/partner's name, and must be intended as your principal place of residence within one year of purchase.

How is the Credit Calculated?

The HBTC is calculated by multiplying the lowest personal federal income tax rate (currently 15%) by $10,000:

$10,000 × 15% = $1,500 tax credit

This credit reduces the amount of federal income tax you owe. It is non-refundable, meaning it can reduce your tax balance to zero but will not generate a refund if the credit exceeds your tax owed. If you share the home with a spouse or partner, you can split the $10,000 amount between your two returns — but the combined total claimed cannot exceed $10,000.

How to Claim the HBTC in 5 Steps

Complete your T1 General Income Tax and Benefit Return for the year in which you purchased the home (you cannot claim retroactively for prior years).
Locate Line 31270 — "Home Buyers' Amount."
Enter $10,000 on that line (or the split amount if claiming with a partner).
The CRA will automatically calculate the 15% credit and apply it to your federal tax owed.
You do not need to submit any supporting documentation when you file, but keep your purchase documents in case of a CRA review.

Don't Forget: Municipal LTT Rebate (Toronto Buyers)

If you purchased property within the City of Toronto, you may also be eligible for the Municipal Land Transfer Tax (MLTT) First-Time Buyer Rebate of up to $4,475 — in addition to the $4,000 provincial LTT rebate. This must be claimed within 18 months of the registration date.

Other FTHB Credits to Stack

The HBTC can be claimed alongside other first-time buyer incentives. A savvy buyer should be stacking:

HST New Housing Rebate (up to $130,000 for new builds under Bill C-4, effective May 27, 2025)
Ontario LTT Rebate (up to $4,000)
FHSA Withdrawals (up to $40,000 tax-free)
HBP Withdrawals (up to $60,000)
HBTC (up to $1,500)

Combined, a first-time buyer could access well over $200,000 in combined tax savings, rebates, and tax-free savings — depending on their specific situation.

Official Source: CRA — Home Buyers' Amount (Line 31270)

Frequently Asked Questions

How do I claim the Home Buyers' Tax Credit on my Canadian tax return?

Claim the Home Buyers' Tax Credit (HBTC) on your T1 General income tax return for the year in which you purchased the home. Enter $10,000 on Line 31270 ('Home Buyers' Amount'). The CRA automatically calculates 15% of that amount — yielding up to $1,500 in federal tax relief. If you're purchasing with a spouse or partner, you can split the $10,000 claim between your two returns in any proportion, but the combined total across both returns cannot exceed $10,000. No supporting documentation needs to be filed with your return, but retain your purchase documents in case of a CRA review.

Can I claim the Home Buyers' Tax Credit if I bought a pre-construction condo?

Yes. The Home Buyers' Tax Credit applies to pre-construction purchases — the eligible year is the year in which you take possession of the home (typically the interim occupancy date on a pre-construction unit, or the final closing date if they occur in the same year). The CRA looks at when you first occupied the unit as your principal residence, not when you signed the Agreement of Purchase and Sale. If your interim occupancy and final closing fall in different tax years, consult a tax professional to confirm the optimal year to claim.

Is the Home Buyers' Tax Credit refundable or non-refundable?

The HBTC is a non-refundable federal tax credit, meaning it can reduce your federal income tax owing to zero, but it will not generate a cash refund if the credit amount exceeds your tax owed. For example, if your federal tax owing is $800 and your HBTC is $1,500, you eliminate the $800 owing entirely but do not receive the remaining $700 as a refund. Buyers with very low income in the purchase year may not capture the full value of the credit. In that scenario, your spouse or partner can claim a greater proportion of the $10,000 base amount on their own return.

What other federal and provincial credits should I stack with the Home Buyers' Tax Credit?

The HBTC should be claimed alongside every available first-time buyer program in Ontario: the federal GST New Housing Rebate under Bill C-4 (up to $45,000 on a $1M new build), the Ontario New Housing Rebate on the provincial portion (up to $24,000), the Ontario LTT Refund ($4,000; $8,475 in Toronto), an FHSA qualifying withdrawal (up to $40,000 tax-free), and the RRSP Home Buyers' Plan ($60,000 per person). A well-coordinated first-time buyer in Ontario can access over $200,000 in combined tax savings, rebates, and tax-free savings depending on purchase price and individual circumstances.