If you are a first time home buyer or builder, be sure to talk to your accountant about the first-time home buyers tax credit and other incentives, including the ability to withdraw from your RRSP for a downpayment. For more information on this, talk to your accountant or read information direct from the Canada Revenue Agency.
To summarize, here is an excerpt from a recent Tax Guide published in 2012 by several Members of Parliament across the province:
FIRST-TIME HOME BUYERS’ TAX CREDIT
The fees associated with purchasing a first home can really add up. To help Canadians with these costs, [our Government] introduced the First-Time Home Buyers’ Tax Credit. The credit allows Canadians to save up to $750 on qualifying homes purchased after January 27, 2009. The First-Time Home Buyers’ Tax Credit is also available to existing homeowners who are eligible for the Disability Tax Credit (DTC) who purchase a more accessible or functional home, or for the benefit of a DTC-eligible person who is related to the individual purchasing the home.
HOME BUYERS’ PLAN
For many first-time home buyers or builders, saving for a down payment can be the most challenging part. To help Canadians saving for their first big purchase, [our Government] raised the amount Canadians can withdraw from their Registered Retirement Savings Plans (RRSP) for a down payment on their first home. Through Canada’s Economic Action Plan, [our Government] increased the maximum Canadians can withdraw from their RRSPs for a home purchase to $25,000. Through these important actions, [our Government] is helping Canadians realize their dream of buying a new home.