BUYING IN BC

GST on a new home in BC, worked out at Kelowna prices

A newly built home in BC carries 5% GST, and at Kelowna prices almost nobody gets the regular rebate back, because it ends at $450,000. First-time buyers are the exception. They can now get up to $50,000 back on a new home valued up to $1 million, reducing to nothing at $1.5 million.

On a $1.2 million new build that’s $60,000 of tax, so it’s worth understanding before you compare a new home against a resale one. Here’s how it works, as of September 2026.

New homes carry GST, resale homes generally don’t

GST applies when you buy a newly built or substantially renovated home. In BC that’s the 5% federal GST. There’s no HST here, so there’s no provincial portion on top.

A resale home is different. When an individual sells a house they’ve lived in, and it hasn’t been substantially renovated, the sale is generally exempt. So the same budget buys a different amount of house depending on whether the home is new, and that’s the comparison most buyers never run.

The regular rebate doesn’t reach Kelowna

There’s a long-standing GST new housing rebate, and on paper it’s generous: 36% of the GST, up to $6,300. The catch is the price limit. The full rebate only applies up to $350,000, it shrinks from there, and at $450,000 or more there’s no rebate at all.

The median detached sale price in the City of Kelowna is $975,000 for 2026 so far, across 815 sales from January to August, according to the Interior REALTORS® Matrix system. That’s more than double the cut-off. For a new detached home here, this rebate effectively doesn’t exist.

The first-time buyers’ rebate

The one that matters is newer. The first-time home buyers’ GST rebate gives back 100% of the GST on a new home valued up to $1 million, to a maximum of $50,000. Between $1 million and $1.5 million it’s reduced gradually, and at $1.5 million or more there’s no rebate.

The reduction is a straight line: the $50,000 maximum drops by $10,000 for every $100,000 over $1 million. The federal government’s own example is a $1.25 million home, halfway through the range, which gets $25,000.

To qualify, broadly:

  • You’re at least 18, and a Canadian citizen or permanent resident
  • You haven’t lived in a home that you or your spouse or common-law partner owned, anywhere in the world, as your primary residence at any time in the current calendar year or the previous four
  • Neither of you has received this rebate before
  • You bought the home from a builder under an agreement signed on or after March 20, 2025 and before 2031, or you built it yourself or hired someone to
  • Construction starts before 2031 and is substantially complete before 2036
  • You’re buying it as your primary residence, and you’re the first person to live in it after it’s built

The “previous four calendar years” part is worth reading twice. Plenty of people who owned a home years ago qualify again.

What it’s worth at Kelowna prices

For a first-time buyer on a new home, taking the price as the home’s value:

  • $900,000: GST of $45,000, all of it rebated
  • $1,000,000: GST of $50,000, all of it rebated
  • $1,100,000: GST of $55,000, rebate of $40,000, so $15,000 paid
  • $1,250,000: GST of $62,500, rebate of $25,000, so $37,500 paid
  • $1,400,000: GST of $70,000, rebate of $10,000, so $60,000 paid
  • $1,500,000 or more: GST of $75,000 or more, no rebate

Under $1 million, a first-time buyer on a new home pays no GST at all. By $1.4 million the rebate is small next to the tax.

It stacks with the new home transfer tax exemption

BC has its own break for new homes. A newly built home that’s your principal residence can be fully exempt from property transfer tax up to a value of $1,100,000, and you don’t have to be a first-time buyer to get it.

Put the two together for a first-time buyer on a new $1,100,000 home. The property transfer tax would normally be $20,000, and it’s zero. The GST would be $55,000, and $40,000 of it comes back. That’s $75,000 of tax reduced to $15,000, which is a real reason to look at new construction if you qualify for both.

What I’d do

Ask every builder whether their price includes GST or has it added, because both happen. Then, if you’re a first-time buyer, work out your rebate at the actual price before you compare a new home with a resale one, because under $1 million the difference is the whole GST.

If you’re shopping between $1 million and $1.5 million, remember the $10,000-per-$100,000 rule, and check where you’d land on the property transfer tax exemption too. The first-time buyer’s guide lays out every cost in order, and working through this is part of how I work with buyers.

General information about GST on new homes and the federal rebates, current as of September 2026, and not tax or legal advice. Eligibility depends on your circumstances and the rebate rules; confirm yours with the Canada Revenue Agency or an accountant. Braden Koop Personal Real Estate Corporation operates under RE/MAX Kelowna. Each RE/MAX office is independently owned and operated.

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