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Ontario's HST Rebate for Substantial Renovations, Explained

Homeowners planning something bigger than a single room often ask us the same thing: "Isn't there a rebate where you get some of the HST back on a big renovation?" There is — but it's narrower than most people hope, and it only applies to a true gut. Here's how it actually works, how much you can realistically claim, and what your builder does and doesn't do for you.

Adam McQuaig · · 10 min read
Refreshed staircase and railings inside a gut-renovated home — a HandKind Construction renovation, Brant County, Ontario
A whole-home renovation by HandKind Construction in Brant County, Ontario.
Table of contents
  1. What the CRA means by a "substantial renovation"
  2. How much you can actually get back
  3. The new 2026 Ontario Enhanced rebate
  4. Who actually files it — you, not your contractor
  5. Paperwork and deadlines to keep in mind
  6. Is your project likely to qualify?
  7. Sources and references

When a renovation is big enough, one of the first questions we hear is whether the government gives any of the tax back. Somebody's cousin heard about a rebate, or an article mentioned "getting your HST back on a reno," and homeowners reasonably want to know if it applies to them. The short answer: a rebate does exist, it's real, and on a large project it's worth real money — but it's built for a very specific kind of renovation, and an ordinary kitchen or bathroom job won't come close to qualifying.

Before we go further: HandKind builds houses, we don't file taxes. Nothing below is tax advice, and we can't tell you whether you personally qualify. What we can do is explain how this rebate interacts with a renovation and what paperwork our process produces to support a claim. Confirm your own eligibility and the current dollar amounts with your accountant or the Canada Revenue Agency (CRA) before you count on any number. Every figure here was verified against CRA publications as of August 2026, and these rules do change.

What the CRA means by a "substantial renovation"

The rebate people are usually thinking of is the GST/HST New Housing Rebate. The name is misleading, because it isn't only for brand-new construction — it also applies to an existing home that has been substantially renovated. When a renovation is extensive enough, the CRA treats the finished home as if it were newly built, and the same rebate becomes available.

The bar for "substantially renovated" is high. The test the CRA uses is the 90% test: generally, 90% or more of the interior of the existing house has to be removed or replaced. In practice, the interior is essentially gutted. The helpful part is what you're allowed to keep — you do not have to remove or replace the foundation, the exterior and interior load-bearing walls, the roof, the floors, or the staircases, and the renovation can still meet the 90% test. Those structural elements can stay exactly where they are.

A few more details that decide whether a project clears the bar:

The honest reality check: most renovations we do will not meet this test. A kitchen, a couple of bathrooms, even a well-done main-floor refresh leaves far more than 10% of the interior in place. Where this rebate comes into play is a genuine whole-home gut renovation — the kind of project where the house is taken back to studs throughout.

How much you can actually get back

HST in Ontario is 13% — a 5% federal part and an 8% provincial part. There's a rebate on each part, calculated separately, and they have very different rules.

Rebate Rate Maximum
Federal (the 5% GST portion) 36% of the 5% GST you paid on eligible costs $6,300 — but it phases out as the home's value rises from $350,000 to $450,000, and disappears entirely at $450,000+
Ontario (the 8% provincial portion) 75% of the 8% provincial HST you paid $24,000 if you paid HST when you bought the land; $16,080 if you didn't — with no upper value limit

Two things in that table matter a lot for local homeowners. First, the federal portion often ends up being nil. It's based on the home's fair market value once the renovation is substantially complete, and it's fully phased out at $450,000. A gut-renovated home in Brantford, Paris or Brant County frequently finishes above that, which means the federal rebate has already vanished before you get to it.

Second, the Ontario portion is the one most people will actually receive, and its cap depends on whether you paid HST on the land. If you bought a used resale home — where no HST is charged on the purchase — and later gut-renovated it, your Ontario maximum is $16,080, not $24,000. And unlike the federal rebate, the Ontario rebate has no fair-market-value ceiling: you can still claim it even if the finished home is worth well over $450,000.

So the number worth planning around, for a typical substantial renovation of a home you already own in this area, is the Ontario rebate up to about $16,080 — plus a bit of federal only if the finished value stays under $450,000. It's a meaningful offset on a project that costs several hundred thousand dollars. It is not a windfall, and it only exists at all if the work clears the 90% gut test above.

The new 2026 Ontario Enhanced rebate (and why not to count on the $80,000 headline yet)

You may have seen news in 2026 about an enhanced Ontario rebate worth up to $80,000. It's real. The Ontario Enhanced New Housing Rebate can rebate up to $80,000 of the 8% provincial part of the HST on a new or substantially renovated home — a full rebate of that 8% on a home valued up to $1 million, with scaled-down amounts above that — plus a separate top-up equivalent to the 5% federal part. That's dramatically more generous than the older $24,000 cap.

Here's the catch, and why we're careful about it. As published, the enhanced rebate is built around homes bought new from a builder: the core eligibility hinges on an agreement of purchase and sale between the buyer and a builder entered into on or after April 1, 2026 and on or before March 31, 2027. For owner-built homes — the category a renovation to a home you already own falls under — the CRA has stated the application details are still being finalized, with forms and further guidance expected through the second half of 2026.

In plain terms: don't assume the $80,000 figure applies to your gut renovation. Until the owner-built rules are confirmed, plan around the standard rebate amounts above, and ask your accountant whether the enhanced rebate could apply to your specific project by the time it's finished. This is exactly the kind of program detail that shifts month to month.

Who actually files it — you, not your contractor

This one surprises people, so it's worth being clear. On a substantial renovation, the homeowner claims the rebate directly. A contractor you hire to do the work is not the "builder" for rebate purposes — the CRA specifically says a contractor hired by the owner to renovate a house on land the owner holds is not the builder. That means HandKind doesn't file this rebate for you, and you don't need us to. You file it yourself, after the work is substantially complete, using the CRA's owner-built forms: a calculation worksheet, the rebate application, and the Ontario rebate schedule that goes with it.

What we do control is whether your claim is easy to prove. A rebate is only as good as the paperwork behind it, and the CRA can ask to see it. Our part is straightforward: clear, itemized invoices that show the HST paid, a documented scope of work, and the permit records for the project. That's normal to how we bill and document a job anyway — so if your renovation is heading toward a full gut and you intend to claim the rebate, tell us early. We'll keep the invoicing and records in the shape your accountant will want, instead of you reconstructing it a year later.

Paperwork and deadlines to keep in mind

Is your project likely to qualify?

A quick gut-check before you spend any time on this:

If you can honestly answer yes to the gut test, the rebate is worth pursuing — take your invoices and the numbers above to your accountant. If you're doing a single kitchen, a bathroom or two, or a partial main-floor update, it almost certainly won't qualify, and we'd rather tell you that up front than have you bank on money that isn't coming.

The projects where this genuinely comes up are whole-home gut renovations, major additions and second-storey builds, and some conversions to legal secondary suites. If a legal suite for a family member is part of your plan, note that there's also a separate Multigenerational Home Renovation Tax Credit — that's an income-tax credit with its own rules, not part of the HST rebate, and we'll cover it on its own another week.

Bottom line: on a true whole-home gut in Ontario, the HST new housing rebate is a real offset — realistically up to about $16,080 provincially for a renovated resale home, plus some federal if the finished value stays under $450,000. It does not apply to ordinary room renovations, and the headline $80,000 enhanced rebate isn't confirmed for owner-renovations yet. Confirm your eligibility and the current amounts with your accountant or the CRA before you count on any of it.

If you're weighing a substantial renovation in Brantford or Brant County, get in touch and we'll come take a look. The initial site visit has no cost and no obligation — and if you plan to claim the rebate, tell us, so we document the job accordingly from day one.

Also worth reading:

Sources and references