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First time homebuyer - definition

Discussion in 'Canadian Finance and Taxation' started by EU_2010, Aug 31, 2017.

  1. Hello,

    I sold my place overseas and am now looking to buy in Toronto.

    As a first time homebuyer, I believe that I get a little discount on the land transfer tax as well as that I can borrow up to 25k from my RRSP to use as part of my downpayment. I am aware that the latter only works if I pay those 25k back over a number of years according to the rules.

    My mortgage "specialist" tells me that I am not eligible for either because I am not a first time homebuyer. It is correct that I previously purchased a home, but this was not in Canada and it would be my first time in Canada and taking advantage of the above mentioned benefits.

    I think she just cannot be bothered to do the paperwork, but wanted to ask here what the rules are.

    Many thanks!
  2. Google is your friend:


    "To claim a refund, you must be at least 18 years of age, you cannot have owned a home or an interest in a home anywhere in the world, and your spouse cannot have owned a home or interest in a home, anywhere in the world while he or she was your spouse."
    EU_2010 likes this.
  3. Thank you kindly for the very speedy reply, scylla.
    That was a helpful link and I understand I am not eligible for a discount on the land transfer tax. That's fine.

    When it comes to borrowing from the RRSP (and repaying within 15 years), I understand that there is a different definition of first home buyer:


    "Are you a first-time home buyer?
    Unless you are a person with a disability or you are helping a related person with a disability buy or build a qualifying home, you have to be a first-time home buyer to withdraw funds from your RRSP(s) to buy or build a qualifying home.

    You are considered a first-time home buyer if, in the four year period, you did not occupy a home that you or your current spouse or common-law partner owned."

    I lived in that home when I first bought it but moved out in 2006. I have been renting it out since and have lived in different countries in rental places, so in line with the above requirement, I have not occupied the home that I owned.

    So I understand I should be able to borrow from my RRSP?
  4. EU_2010 likes this.
  5. CRA does not information about the home owned outside Canada unless you declared it during tax filing.
    A friend of mine owned a mortgage free home outside North America. He qualified for first time home buyer credit and also for withdrawing from RRSP for his first home in Canada.
  6. Thank you, Investocrat. Looking at the form now I understand that I should be eligible.

    Hi Sapguru, yes, CRA does have the information since I declared that property on my income tax every single year. I don't qualify for first time home buyer credit and that's ok. Whether they'll find out or not, I want to do what's right as that type of thing can always catch up with you later. Not worth it.
  7. #7 randybonns, Jul 15, 2019 at 3:36 AM
    Last edited: Jul 15, 2019

    I didn't declare my property in Germany last year. And now I want to buy property in Toronto. Will I have to pay tax on the gain? Should I declare the foreign property that’s worth less than $100,000 CAD anyway? Thanks.
  8. Yes you have to declare things like rental income or capital gains if you sell. Otherwise that is tax fraud.

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