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HST and how it applies to Real Estate:
On July 1, 2010, the provincial and federal governments will combine the 7% provincial sales tax (PST) and the 5% federal Goods and Services Tax (GST) into a 12% Harmonized Sales Tax (HST). Here is updated information, verified by Canada Revenue Agency as of May 21, 2010. This information is in response to questions and comments from members. We greatly appreciate your input. As a rule of thumb, the GST rules that now apply to residential property will also apply under the HST.
How does it apply to Real Estate Commissions:
Commissions will be subject to HST in the same manner as they currently attract GST. Commercial vendors will be able to claim input tax credits on HST paid to agents, while individuals selling personal use property will not.
How does HST apply to Non-Residential Real Estate:
As a rule of thumb, the 12% HST will apply to non-residential sales and leases in the same way the 5% GST now applies. This includes exemptions and input tax credits for GST/HST registrants including tenants and purchasers.
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