The New 100% GST/HST Rebate for MURCs in Canada

The 2023 federal budget introduced a major update for developers and builders of new rental housing: the 100% GST/HST rebate for new purpose-built rental housing. I’ve been getting a lot of questions about this from clients in real estate and construction, so here’s a quick overview of what it means and who qualifies.

This change applies to what are called MURCs—multi-unit residential complexes.

What Is a MURC?

According to the CRA, a multi-unit residential complex typically refers to:

• Apartment buildings
• Purpose-built rental condos
• Mixed-use properties with at least 90% residential units

You can read CRA’s definition of MURCs here:
CRA - Multi-Unit Residential Complex (MURC)

What Changed?

Prior to this update, new rental housing construction was eligible for a partial rebate of the GST (and the federal portion of HST) under certain conditions. Now, qualifying purpose-built rental housing projects can get a full 100% rebate of the federal portion of GST/HST.

This change is aimed at encouraging developers to build more long-term rental stock across the country.

Who Qualifies?

The key criteria as per CRA guidance are:

• Construction must begin after September 13, 2023, and before 2031
• The project must be a new purpose-built rental property
• It must have at least four private apartment units or 10 private rooms or suites
• The units must be intended for long-term rental (at least 12 months)

Condominium projects that are later converted into rental housing do not qualify. Properties built solely for short-term rental (like Airbnb) also don’t qualify.

CRA’s official GST/HST rebate page is here:
CRA - GST/HST New Residential Rental Property Rebate

What About Provincial Rebates?

The 100% rebate only applies to the federal portion of the GST/HST.

In Ontario, the province has announced it will match the enhanced federal rebate for qualifying new rental housing. You can read the Ontario government’s announcement here:
Ontario Newsroom - Ontario Supporting New Purpose-Built Rental Housing

Always check with your province or speak to your accountant for specifics.

Final Thoughts

If you’re a builder, developer, or investor planning a multi-unit rental project, this rebate can significantly reduce your upfront tax costs. But like any tax incentive, proper planning and documentation will be key.

I always recommend clients speak with a tax professional before breaking ground to ensure eligibility and avoid surprises when it’s time to file for the rebate.

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