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The 100% GST/HST Rebate for New Purpose-Built Rental Apartments: What Qualifies, From Groundbreaking to Lease-Up

The enhanced rebate can return the full federal GST — and in Ontario the provincial part too — but eligibility is decided across the whole life of the project, starting with the day construction began.

Arthur Zhao · Broker · AZ Real Estate Partners · 2026-09-28

Quick Answer

What is the GST/HST purpose-built rental housing (PBRH) rebate, and what decides whether a new rental building can claim it?

It is an enhanced form of the GST/HST new residential rental property (NRRP) rebate that returns 100% of the GST — the federal part of the HST — on a qualifying new rental building, with no phase-out as the building’s value rises. Under the Excise Tax Act, the rebate equals the full federal tax treated as paid on the building. Whether a project qualifies is not settled at any single moment — it is tested across the building’s life: when construction started, how many self-contained units it holds, how those units are leased, and when it is substantially complete. In Ontario, a project that meets the federal conditions can also recover 100% of the provincial part of the HST.

Source: Excise Tax Act, s. 256.2 (Justice Laws, current to 2026-09-03); Canada Revenue Agency, “GST/HST new residential rental property rebate” (canada.ca, 2026).

I’m Arthur Zhao, a Toronto real estate broker. Part of whether a new rental building gets this rebate is decided on the day the first shovel goes into the ground — before a single apartment is drawn, leased, or finished. The purpose-built rental housing rebate rewards buildings that are meant to be rented, and it reads a project the way a timeline reads: a start date, a set of design choices, a lease-up test, a finish line, and a filing. Miss the window at any of those points and the rebate can slip, even after the tax has been paid. This article walks that timeline in order. It is general information, not tax or legal advice — whether a specific project qualifies is a question for your accountant or tax advisor.

ℹ️This article explains the rules in general terms. Whether a specific building qualifies — and for how much — depends on its own facts; confirm with your accountant or tax advisor before filing.

The rebate rides along the project’s timeline

Some tax questions turn on a single moment — the day of a sale, the date of a return. The purpose-built rental housing (PBRH) rebate is different: its conditions are spread from the start of construction through to the way the finished building is leased. That is why it helps to follow a project in order and ask, at each point, what the rebate is checking. The reward for clearing every stage is large — under the Excise Tax Act the enhanced rebate returns 100% of the GST, the federal part of the HST, on the building, with no phase-out as value rises. What follows is that timeline, from groundbreaking to the filing.

Stage by stage: from groundbreaking to filing

Here is the same rebate, walked through the life of one building — five stages, each carrying a condition the rebate is testing.

Groundbreaking: the calendar window the first shovel must fall inside

The rebate starts reading a project at the beginning of construction. To qualify, construction — or the last substantial renovation — of the residential building must begin after September 13, 2023 and before 2031. For a project that converts an existing non-residential property — say an office building turned into apartments — there is an extra reading of that same date: the property must have existed on September 13, 2023, must not have been under construction that day, and must not already have been used as a residential building. A lot is decided by the calendar before any apartment exists.

Design: how many units, and which building types are shut out

Once the building is being drawn, two design facts decide eligibility. First, size and layout: it must be a multiple-unit residential building with at least 4 residential units, each a self-contained unit with its own private kitchen, bathroom, and living area, or at least 10 residential units. Second, building type: several common forms are shut out of this enhanced rebate — an individual condominium unit, a single-detached house, a duplex, a triplex, and an owned home on leased land or in a residential trailer park. (Some of those may still qualify for the standard NRRP rebate, a separate and capped rebate — but not for this 100% one.) These are design-stage decisions because unit count and building type are fixed long before lease-up.

⚠️If your project is a single condominium unit, a duplex, or a triplex, it does not qualify for this 100% purpose-built rental rebate — regardless of how it is rented. Those forms are excluded by building type, not by how well they meet the other stages.

Lease-up: the 90% long-term-rental test

A purpose-built rental only earns the rebate if it is actually used as long-term rental housing. The test: at least 90% of the residential units must be held for making exempt long-term residential rental supplies — that is, leased to individuals as their place of residence. For a project that is an addition to an existing building (a new wing), the addition itself must clear the 4-plus-self-contained-units or 10-plus-units bar, and a double 90% test applies: the addition on its own must meet the 90%, and the whole building including the addition must also meet it. How the finished units are leased is part of qualifying, not an afterthought.

⚠️The 90% condition is about units being held for long-term residential leasing. Units put to other purposes do not count toward it, and falling below the threshold can put the rebate at risk. Keep records of how each unit is leased.

Completion: the finish line before 2036

The rebate also sets a finish line: the building must be substantially completed before 2036. Paired with the groundbreaking window — construction beginning after September 13, 2023 and before 2031 — this gives a project a defined runway. It has to start inside the opening window and cross the completion line before the closing one. A project that begins in time but drags past the completion date can fall outside the rule.

Filing: the forms, the province, and the paperwork you keep

When the building is complete and leased, the claim is filed. For a multiple-unit building the core forms are GST524, the GST/HST new residential rental property rebate application, together with GST525, the supplement for co-operative housing and multiple units, plus the applicable provincial rebate schedule. The application can be filed through a CRA business account online. Keep the supporting records for 6 years — the rebate turns on facts a reviewer may later want to see: the construction start, the unit count and layout, and how the units were leased.

💡 Because the conditions sit at different points in the building’s life, a project cannot be qualified by paperwork at the end alone. The date construction began, the units on the drawings, the way the finished apartments are held for rent, and the completion date each have to line up — so the rebate is less a form you file at the end than a set of conditions the whole project has to meet, from the first shovel onward.

Ontario: the provincial part comes back too

The federal rebate returns the GST, which is the federal part of the HST. According to the Canada Revenue Agency and the Government of Ontario, the HST in Ontario is 13%, made up of the 5% federal GST and an 8% provincial portion. For a purpose-built rental that meets the federal conditions, Ontario also allows a rebate of 100% of the provincial part of the HST — so a qualifying Ontario build can recover the federal 5% and the provincial 8%, effectively the full 13%. (Newfoundland and Labrador and Nova Scotia have their own versions of the provincial rebate; other provinces differ.) This is separate from the standard Ontario new residential rental property rebate on the provincial part, which can apply to some rentals whose fair market value is $450,000 or more even when the federal NRRP does not — a different rebate from the purpose-built one described here.

ℹ️Ontario has also introduced a separate, temporary “enhanced” new residential rental property rebate (ENRRP) — a different rebate from the purpose-built rental rebate described here. Confirm its current details with the CRA or your tax advisor.

One building, one rebate: the public-service-body choice

A few applicants face an extra decision. A public service body (PSB) — such as a charity or non-profit that operates rental housing — can claim either its PSB rebate or the purpose-built rental rebate on the same building, but not both; it has to choose. A housing co-operative that meets the conditions can also apply. For a private developer or landlord, the purpose-built rental rebate is simply the relevant one; the either/or choice exists because public service bodies have their own PSB rebate, so it is that world — non-profit and charitable housing — where the choice has to be settled before filing.

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Frequently Asked Questions

Can converting an office building into apartments qualify for the rebate?

A conversion can qualify, but it faces an extra timing check. The property being converted must have existed on September 13, 2023, must not have been under construction on that day, and must not already have been used as a residential building. It also has to meet the same unit-count, 90% rental, completion, and filing conditions as a new build. Confirm the specifics with your tax advisor.

Does adding a new wing to an existing rental building count?

An addition can qualify on its own. The added portion has to contain at least 4 self-contained units or 10 or more units, and a double 90% test applies: the addition alone must have 90% of its units held for long-term residential rental, and the whole building including the addition must also meet the 90%. The addition is assessed as its own project against those bars.

What if some units end up as short-term rentals instead of long-term leases?

The rebate depends on at least 90% of the residential units being held for exempt long-term residential rental — leased to individuals as their residence. If units are put to purposes that do not count toward that 90%, the building can fall below the threshold and put the rebate at risk. Keep clear records of how each unit is actually used.

Which forms do I file, and how long do I keep the records?

For a multiple-unit building you file Form GST524, the new residential rental property rebate application, together with Form GST525, the supplement for co-operative housing and multiple units, and the applicable provincial rebate schedule. You can file through a CRA business account online, and you should keep the supporting records for 6 years.

We are a non-profit that runs rental housing — can we claim both our public service body rebate and this one?

No. A public service body can claim either its PSB rebate or the purpose-built rental rebate on the same building, but not both — it has to choose one. A qualifying housing co-operative can apply for the purpose-built rental rebate as well. Which choice is better depends on the numbers, so work it through with your accountant before filing.

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