GST
Many listings come on the market today with the caveat “GST may be applicable”. Basically this a lazy way to say you may have to pay GST, but I don’t know for sure.
First of all, it is entirely the sellers responsibility to determine whether or not GST is to be paid. However, even as a buyer, it is in your best interest to do some research and make sure what the seller has determined is correct, otherwise future issues may arise during conveyencing.
On the surface you can expect to pay GST on the sale of any brand new home or commercial property and buildings, commercial land, and farm land.
On the other hand, any USED residential complexes (including anything lived in, mobile properties and multi family dwellings) are exempt from GST.
Personal use property is also usually exempt from GST – this includes vacant residential lot for personal use, recreational property with a cabin, or a rural property that has never been used commercially.
The biggest grey area for GST is usually around farm land. If there is any revenue generated from the farm land (pasture or crops) than GST applies – however only to the revenue generating portion (not the house and the land that it resides on).
So – as long as you are purchasing or selling a USED home, GST is not applicable. However in any other scenario it would be prudent to have you and your Realtor do some further research into the topic, regardless of whether you are on the buying or selling end.
