In Alberta the HST/GST is handled differently than Ontario.
In Ontario, as an investor, you pay approx 8% of the price (to a max of $24,000) on final closing and you apply for a rebate to get the HST back, and in most cases you get most of it back.
The HST in Ontario is money you have to pay on closing out of your own pocket. You cannot use a mortgage to pay for it.
This 8% (max $24,000) in Ontario is in addition to the $30-40k in closing costs you have to pay out of pocket and cannot roll into a mortgage.
In Alberta, you pay 5% of the price which is the GST portion on final closing.
The good news is that the 5% is included in your mortgage in Alberta!
As an investor, there is a program where you can apply to get a portion of the GST you paid rebated back to you. The maximum you get back is 36%.
If the price is up to $350k, you get back 36% of the GST you paid.
If the price is between $350k-$450k, it’s a sliding scale where the 36% rebate shrinks down to zero by the time you hit $450k.
The GREAT news about GST in Alberta is you can roll it into your mortgage, you DO NOT have to pay this money on closing out of your own pocket!
So for example (all figures approximates):
Purchase price $250,000 – you pay $12,500 in GST. you get a rebate back for $4500.
Actual total GST paid = $8000
Purchase price $350k – you pay $17,500 in GST. you get a rebate back for $6300.
Actual total GST paid = $11200
Purchase price $400k – you pay $20k in GST. you get rebate back for $3100.
Actual total GST paid = $16,900
Purchase price of $450k – you pay $22,500 in GST, nothing rebated back.