Home Buyers' Tax Credit

Have you heard about the Home Buyers' Tax Credit (HBTC)? It's a new non-refundable tax credit that's available for people who have bought a qualifying home after January 27, 2009.

Based on $5,000, the HBTC is calculated by multiplying the lowest personal income tax rate for the year (that was 15% in 2009) by $5,000. For 2009 the credit was $750.

So who qualifies for the Home Buyers' Tax Credit? Anyone who acquires a qualifying home and has not lived in another home owned by you, your spouse or your common-law partners in the same year or the four preceding years. Persons with disabilities do not have to be first-time buyers, but their new home must be acquired because it is more accessible or better suited to their needs.

Qualifying homes are located in Canada and include new homes and new condos as well as existing homes. Detached, semi-detached, townhomes, mobile homes, condos and apartments all qualify. A share in a co-operative housing corporation that entitles you to possess and gives you an equity interest in a housing unit also qualifies.

The only other catch is that you must intend to occupy the home that you buy as a principal resident no later than one year after you've purchased it.

If you buy a home with another person (your spouse, common-law partner or friend) either one of you can claim the credit, or you can share it. Whatever you decide, the total of your combined claims cannot exceed $750 (or whatever the credit is in the year you buy).

For more information and to find the most up-to-date forms, policies and guidelines, be sure to visit the Canada Revenue Agency's website.