How to calculate HST in Ontario - Real Estate:
The Ontario provincial government has combined the 8% PST (Provincial Sales Tax) with the 5% FST (federal Goods and Services Tax), creating a new 13% HST - Harmonized Sales Tax
The HST came into effect on July 1, 2010:
- HST does NOT apply on the purchase price of re-sale homes.
- But, HST DOES apply to services such as moving cost, legal fees, home inspection fees, appraisal fees, labour for renovations, landscaping and REALTOR® commissions if applicable.
- It is estimated the average home buyer will likely pay $1200 - $1500 additional cost in HST fees when moving.
- HST applies to the purchase price of newly constructed homes. However, the Province is proposing a rebate so that new homes across all price ranges would receive a 75 per cent rebate of the provincial portion of the single sales tax on the first $400,000. (so that's basically a savings up to the first $24,000 hst)
- For new homes under $400,000, this would mean, on average, no additional tax amount compared to the current system.
- Is there HST on Rent?
If you are currently renting a house, condo or townhouse on a long term bases (or month to month) you are currently not paying GST, therefore, HST will not apply. However, expect that the Landlord will have increased costs for the goods and services he uses, such as labour for repairs, landscaping etc. With increased costs to the owner, increases in rental rates in the future might be expected.
Is there HST on Condominium Maintenance Fees?
Currently there is no GST charged by Condominum Associations. But as the HST takes effect, many services associated with the common maintenance of the building will be subject to HST. It makes common sense to expect some adjustments in the future monthly fees.