In addition to RRSP funds, funds under the Ontario Home Ownership Savings Plan (OHOSP) may be used towards a purchase of a home which provide a tax credit for contributions of up to $2,000 per year to the plan provided that such contributions were made prior to May 18, 2004 after which no new OHOSP can be opened. To qualify, you must be earning less than $40,000 per year, or have combined spousal incomes of less than $80,000 per year. The funds will be provided to the lawyer by the Bank to be applied towards the closing costs. OHOSP accounts must be used by May 18, 2011 or be closed.
OHOSP AND LAND TRANSFER TAX REFUND:
(including resale properties)
Under the program, Ontario Land Transfer Tax must first be paid on completion of the real estate purchase with a refund application being made by a purchaser after the completion of the purchase. If your plan was set up prior to January 1, 1994 and the purchase price of your home (resale or new from the builder) is less than $200,000 you may also receive a refund of all (or part) of the Land Transfer Tax payable on the purchase price; such a Land Transfer Tax refund will not apply to OHOSPs set up after January 1, 1994.
In the Toronto area, Land Transfer Tax is fully refundable if the plan was set up prior to January 1, 1994 and the purchase price of the home is less than $150,000; 50% of Land Transfer Tax is refundable if the purchase price is $175,000; No refund is available if the price is $200,000 or greater. In between such prices, there is a sliding scale for the available refund