Real Estate

HST/GST when selling the rental property

  • Last Updated:
  • Jul 20th, 2021 9:14 am
[OP]
Sr. Member
Jul 9, 2014
713 posts
250 upvotes
Toronto, ON

HST/GST when selling the rental property

Hi all,

Just asking if you have experience with the HST/GST when selling the rental property. I am selling the Condominium Townhouse (Old one, not a new build).

My lawyer put the HST section in form 101 as *IN ADDITIONAL TO*, however, I have two buyers' lawyers reject them. Long story short
  • I had first potential buyers, and their lawyer refuses the HST section in form 101 as *IN ADDITIONAL TO*. Their lawyer wanted that as *INCLUDED IN*. So the deal was not done.
  • I also had the second potential buyers, and their lawyer again refuses the HST section in form 101 as *IN ADDITIONAL TO*. Their lawyer wanted that as *INCLUDED IN*. So the deal was not done.
  • Now I had the third potential buyer. And my lawyer still put in form 101 as *IN ADDITIONAL TO* for HST. I am wondering what actually that section HST/GST is for, my lawyer said putting *IN ADDITIONAL TO* to protect me to pay the HST tax. But I researched, it seems like only new build from the builder will be taxable not residential property.
I bought that townhouse 5 years ago, and it was *INCLUDED IN* as well.

Thanks
2 replies
Member
Oct 5, 2016
244 posts
123 upvotes
If its a used residential rental property, there is no HST implication. I dont see why the lawyers are rejecting the deal and I dont know why your lawyer is adamant at leaving it in and not changing it to make a sale. That is a general section in a purchase contract. Has no bearing in this situation.
Deal Addict
Feb 19, 2019
1969 posts
3093 upvotes
Stouffville ON
If the property was rented to residential tenant the sale is HST exempt and on the contract should state hst included. Of course the buyers are rejecting "in addition to" so they are not on the hook incase the property was used as commercial.
Full Time and Full Service Realtor

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