Published | Category : Income tax - individuals

Introduction of a First-time Home Buyers' Tax Credit

A non-refundable tax credit for first-time home buyers has been introduced for the 2018 taxation year.

Qualifying home

A qualifying home of an individual is a housing unit located in Québec that was acquired at a particular time after December 31, 2017, by:

  • the individual or the individual's spouse, where the individual intends to inhabit the home as a principal place of residence not later than one year after the particular time and it is the individual's first housing unit;
  • the individual, where the individual intends that the home be inhabited by a specified disabled person as a principal place of residence not later than one year after the particular time, and the housing unit was acquired by the individual for the specified disabled person to live in:
    • a home that is more accessible by the specified disabled person or in which the specified disabled person is more mobile or functional, or
    • an environment better suited to the specified disabled person's personal needs and care.
Note
A housing unit is an individual house that is detached, semi-detached or a row house, a manufactured home or mobile home, an apartment in an immovable under divided co-ownership (condominium) or an apartment in a multiple-unit residential complex.

A housing unit is a first housing unit if the following conditions are met:

  • The individual did not own, whether alone or jointly, a housing unit that was occupied by the individual in the particular period that began at the beginning of the fourth preceding calendar year that ended before the acquisition of the housing unit and that ended on the day before the acquisition of the housing unit;
  • In the particular period, the individual's spouse did not own, whether alone or jointly, a housing unit inhabited by the individual during their marriage (or during their civil or de facto union).

A specified disabled person is, at a particular time:

  • the individual or a person who is related to the individual at the particular time;
  • a person who is eligible for the tax credit for a severe and prolonged impairment in mental or physical functions for the taxation year that includes the particular time;
  • a person who would have been eligible for the tax credit if no individual had included, in the calculation of the non-refundable tax credit for medical expenses for the year, an amount in respect of remuneration for an attendant or care in a nursing home in respect of the person; or
  • a person in respect of whom the supplement for handicapped children is paid for the month that includes the particular time.

Calculation of the tax credit

The tax credit is calculated by multiplying the rate for the first taxable income bracket of the personal income tax table for the year (which is currently 15%) by $5,000. Thus, the maximum value of the tax credit that an individual can deduct from his or her income tax payable for the year is $750.

To claim the tax credit, an individual must meet the following conditions:

  • The individual is not a trust.
  • The individual is resident in Québec at the end of a taxation year (or, if the individual dies in the year, on the date of the individual's death).
  • The qualifying home was acquired in the year.

If, for a taxation year, more than one individual may claim the first-time home buyers' tax credit in respect of a qualifying home, the total of the amounts that each of these individuals may claim, in the calculation of the tax otherwise payable by each of them for the year, may not exceed the amount that would be allowed if only one of them were eligible for the tax credit for the year.

For more information, see pages A.15 to A.19 of Additional Information 2018-2019 (PDF – 3.73 MB) published by the Ministère des Finances.

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