Buying a pre-construction condo in Mimico should feel exciting, not confusing. Yet many buyers get tripped up by how HST works and what actually shows up on the closing statement. If you want clear answers on taxes, rebates, and cash to close, you’re in the right place. In this guide, you’ll learn how HST applies to new-build condos, how owner and investor rebates differ, and the Toronto-specific costs you should plan for. Let’s dive in.
HST basics on new-build condos
HST in Ontario is 13% and applies to most new residential housing. When you buy a brand-new condo from a builder, the sale is generally subject to HST. The purchase agreement will say whether the price is HST-inclusive or HST-exclusive. Always confirm this in writing.
Upgrades, options, parking spaces, and storage lockers sold by the builder are usually subject to HST. If you request extras after your agreement is signed, expect HST to be calculated at the time those items are billed, often at closing.
Assignments are also common in pre-construction. Selling your contract before final closing is usually an HST-taxable supply. Both the assignment fee and the assignment price can attract HST. If you are considering an assignment, ask your lawyer to model the HST and who is responsible for it.
Deposits can be part of the consideration for HST purposes. Whether HST is remitted at deposit collection or at closing depends on the builder’s accounting and the timing of the supply. Your lawyer can confirm how it will show up on your statement of adjustments.
Some costs are not subject to HST. Provincial and municipal land transfer taxes, for example, are not HST-taxable. Legal fees and certain municipal charges may be exempt or treated differently. Ask your lawyer to confirm the status of each line item.
Owner vs investor rebates: how they work
There are two main rebate paths that affect new-construction buyers. Your plan for the unit determines which one applies.
Owner-occupant rebate
If you will live in the condo as your principal residence, you may qualify for the federal and provincial GST/HST New Housing Rebate. Review the rules on CRA’s GST/HST New Housing Rebate, including eligibility and price thresholds, which can affect how much you receive.
- Many builders help complete the application and credit the expected rebate on closing. Others require you to apply after closing and wait for CRA processing.
- Eligibility depends on occupancy intent and price limits. Confirm the current CRA rules and how your builder handles the credit.
Investor rebate for rentals
If you plan to rent the unit as a long-term residential property, a different program may apply. Review CRA’s New Residential Rental Property Rebate to understand eligibility and timing.
- Residential rent is usually HST-exempt, which affects your ability to claim input tax credits. The rental rebate is designed for long-term rentals and has specific rules.
- Short-term rental use can change eligibility. Confirm your intended use with your lawyer and tax professional before closing.
Assignments and rebate expectations
If you intend to assign your contract, the assignment price is typically subject to HST. Owner-occupant rebates generally do not apply to the assignment amount. Make sure your contract and lawyer’s memo explain how HST will be treated and who pays it.
Toronto-specific closing costs that interact with HST
In Mimico and the rest of the City of Toronto, you should budget for two land transfer taxes. You will pay the Ontario Provincial Land Transfer Tax and the City of Toronto Municipal Land Transfer Tax. Neither tax is subject to HST.
- Review current provincial LTT rates and first-time buyer refunds on the Government of Ontario land transfer tax page.
- Review current municipal rates and refunds on the City of Toronto land transfer tax page.
Builders in Toronto market their prices differently. Some advertise HST included, others exclude HST. Even if advertising says “HST included,” the contract governs how any rebate is handled. Your statement of adjustments should show HST amounts, any rebate credits, and how they are applied or assigned.
If you are financing, confirm with your lender how they treat the expected HST rebate. Some lenders require you to bring cash to cover HST on closing if the rebate will only be paid later. Others allow you to assign the rebate to them. Always get this in writing before you waive financing conditions.
A simple budgeting example
Here is an illustration you can use to frame questions for your lawyer and lender. Do not rely on it as a final calculation.
- Suppose the list price is $700,000 and the contract states the price is HST-exclusive. HST at 13% equals $91,000.
- If you qualify as an owner-occupant, you may be eligible for a partial rebate under CRA rules, which can reduce the net tax. The exact amount depends on CRA thresholds and your eligibility.
- If you are an investor, you typically will not receive the owner-occupant rebate. You may look to the rental rebate program if you meet the conditions.
The big takeaway: confirm whether your price is HST-inclusive or exclusive and get a draft statement of adjustments that shows the line-by-line math well before closing.
Your pre-closing checklist
Being organized prevents last-minute surprises. Use these questions and document requests to get clarity.
Questions for your lawyer
- Is the purchase price HST-inclusive or HST-exclusive? Where is it stated in the agreement?
- How will any HST rebate be handled at closing? Will it be credited to me, kept by the builder, or assigned to the lender?
- If I am an owner-occupant, will the builder apply for the rebate on my behalf or do I apply using CRA form GST190? Please confirm the process and timing.
- If I am an investor planning a long-term rental, do I qualify for the rental rebate using CRA form GST524? What documentation will be needed?
- What are the developer’s rules and HST consequences if I assign my contract?
- How will HST be charged on upgrades, parking, or lockers added after the agreement was signed?
- Will HST be charged on deposits? When will it be remitted?
- Can you provide a draft statement of adjustments that shows HST and any rebate lines?
- Please confirm both provincial and municipal land transfer taxes and whether I qualify for any first-time buyer refunds. Who files these and when?
Questions for your lender or broker
- Will you factor the expected HST rebate into my mortgage approval? What proof do you need?
- If the rebate is paid after closing, can I assign it to you or will I need to bring that amount in cash on closing day?
- Do you require that the rebate be assigned to the lender as a condition of funding? How does that change my cash to close?
- As an investor, how do HST and the rental rebate affect your underwriting?
Documents to request before closing
- A copy of the signed purchase agreement with the HST clause highlighted.
- A sample or draft statement of adjustments showing HST and rebate lines.
- Any written builder policy on rebate treatment at closing.
- The builder’s HST registration number and any declarations used for the rebate application.
- CRA forms and instructions for filing, if you will apply after closing.
Common pitfalls and how to avoid them
- HST on assignment surprises. Many buyers do not expect HST on the assignment price or fee. Ask your lawyer to model the HST and confirm who pays it.
- Expecting an owner-occupant rebate when you are an investor. Decide your intended use early. If the use changes, ask your lawyer and tax professional how it affects eligibility.
- Lender will not count the rebate for qualifying. Some lenders ignore the rebate amount until paid, which raises your cash needed at closing. Confirm this in writing.
- Parking or locker billed separately. If parking or lockers are not part of the original agreement, HST is often charged at closing. Verify early and budget.
- Rebate credited to the builder or lender without clarity. Make sure the contract and the statement of adjustments show who receives the rebate and how it reduces your cash to close.
- Late HST math on the final statement. Ask for an itemized draft statement of adjustments well before closing to avoid last-minute issues.
What to expect in Mimico
Mimico and nearby Long Branch are active pre-construction markets with lake access, transit options, and a steady investor presence. In this environment, builders often have strict assignment rules, and upgrade selections can be common. That makes it even more important to clarify how HST applies to extras and how any rebate will be credited.
You should also plan for both provincial and Toronto land transfer taxes. Neither tax is HST-taxable, but both are significant, and they are due on closing unless you qualify for refunds. Check the current rules on the Ontario land transfer tax page and the City of Toronto land transfer tax page.
Next steps
- Confirm in writing whether your purchase price is HST-inclusive or HST-exclusive.
- Decide if you are an owner-occupant or investor and review CRA guidance for your rebate path: New Housing Rebate, form GST190 or New Residential Rental Property Rebate, form GST524.
- Get a draft statement of adjustments with HST and rebate lines before finalizing your mortgage.
- Ask your lender exactly how they treat the expected rebate and whether assignment of the rebate is required.
If you want a clear, step-by-step closing plan for a Mimico pre-construction purchase, reach out. We can help you map the HST, rebates, and cash to close so there are no surprises on closing day. Connect with Todd Armstrong to get started.
FAQs
How does HST apply to a new-construction Mimico condo purchase?
- HST at 13% generally applies to the purchase price of a brand-new condo from a builder, plus most upgrades, parking, and lockers. Confirm if your contract is HST-inclusive or HST-exclusive.
What is the owner-occupant HST rebate for new condos in Ontario?
- If you will live in the condo as your principal residence, you may qualify for the GST/HST New Housing Rebate. Review eligibility and thresholds on CRA’s GST/HST New Housing Rebate.
What HST relief can a Mimico investor get on a rental condo?
- For long-term rentals, review CRA’s New Residential Rental Property Rebate. Residential rent is generally HST-exempt, so the owner-occupant rebate usually will not apply.
Are Toronto land transfer taxes subject to HST on new condos?
- No. Ontario and City of Toronto land transfer taxes are not subject to HST. Check current rates and refunds on the Ontario LTT page and the Toronto LTT page.
How does HST work if I assign my Mimico pre-construction contract?
- Assignments are typically HST-taxable on the assignment price and fees. Your contract should state who pays the HST. Ask your lawyer to model the costs before you list the assignment.
Will my lender count the expected HST rebate in mortgage approval?
- Policies vary. Some lenders require you to bring cash for HST at closing unless the rebate is assigned to them. Get your lender’s position in writing early.
