New Quebec Tax Break for First-Time Home Buyers

Since 2009, the federal tax legislation offers a tax credit of $750 for first-time home buyers that meet certain criteria. The 2018 Quebec budget has introduced a similar measure for Quebec tax residents. This new provincial tax measure consists of a tax credit in the maximum amount of $750. Quebec taxpayers will be able to benefit from this new credit to the extent that they acquired a home during the year for which the credit is claimed and that following conditions fulfilled:

•     A qualifying home has been acquired on or after January 1st, 2018:

• A housing unit (e.g. an individual house, a condo, etc.) is a qualifying home if it is a first housing unit located in Quebec and if you (or your spouse or common law partner) intend to inhabit the home as a principal residence no later then one year after the date of purchase.

• For a home to qualify as a first housing unit, neither you (nor your spouse or common law partner) must have owned, whether alone or jointly, a housing unit in which you lived during the year of purchase or any of the four preceding calendar years.

In the specific context where the property is going to be inhabited by a disabled person, the eligibility criteria to qualify for the Quebec First-Time Home Buyers credit are modified.

The Quebec First-Time Home Buyers’ Tax Credit is a non-refundable tax credit which implies that the credit cannot be claimed if the taxpayer has no income tax payable before claiming the credit.

The credit may be split between spouses (or common law partners) or between two individuals buying a qualifying home on a joint basis. However, the combined amount claimed cannot exceed $750.

This new tax relief will certainly help to partially alleviate the costs of inspection and/or the notary fees for the First-Time Home Buyers in Quebec. Please make note of this new tax measure ahead of the 2018 personal income tax filing season in order not to miss this opportunity.

For any further details or clarifications, please contact your Crowe BGK advisor.

About the Authors:

Elena Vinogradova, CPA, CA, is a Tax Specialist at Crowe BGK

Connect with her: [email protected]

Isabelle Nadeau, B.C.L., LL.B., LL.M. Tax, is a Partner at Crowe BGK

Connect with her: [email protected]

Samuel Lecavalier, CPA, CGA, MSc. Fin., M. Tax, is a Manager at Crowe BGK

Connect with him: [email protected]