# The home buyers plan



## barleydrinker (Nov 18, 2017)

Before I ask any detailed question about this, does a principle residence outside of Canada count for the first time buyer criteria. I am finding this surprisingly ungooglable.


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## Eclectic12 (Oct 20, 2010)

Are you planning on buying or building a PR outside of Canada, after becoming an Canadian tax resident?

One of the eligibility requirements is to have a written agreement to buy/build a qualifying home. 

The other is to be considered a first time buyer. This means that in the four year period before the withdrawal, you did not occupy a home that you or your current spouse or common-law partner owned. Having a disability or helping someone with a disability buy/build is an exception to this rule.

https://www.canada.ca/en/revenue-ag...buyers-plan/participate-home-buyers-plan.html


Checking the Taxtips.ca web site, I would say a foreign principal residence is not allowed.



> ... A qualifying home means:
> - a * housing unit located in Canada*, or
> - a share of the capital stock of a cooperative housing corporation, the holder of which is entitled to possession of a housing unit located in Canada


https://www.taxtips.ca/rrsp/homebuyersplan.htm


Cheers


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## InvestingForMe (Sep 6, 2012)

Good morning,

Your question is kind of two parts from a Canada Revenue Agency perspective. 

1st, First Time Buyer Credits are only available for housing located in Canada. See CRA guidelines here

And 2nd, Principal Residence Status. In my search of the CRA website, I did not see anywhere that the CRA restricts the Principal Residency Designation to only Canadian properties. But, maybe there is an accountant or two on the forum that can better clarify this point.

Hope this helps.


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## Jimmy (May 19, 2017)

They had a thread in here recently about that but can't find it. Under 'qualifying home it specifies being located in Canada. " Qualifying home – a qualifying home is a housing unit located in Canada. This includes existing homes and those being constructed."

https://www.canada.ca/en/revenue-ag...an/definitions-home-buyer-s-plan.html#qlfy_hm

Looks like you can use the foreign property as a PR too.

2.74 A property that is located outside Canada can, depending on the facts of the case, qualify as a taxpayer’s principal residence (see the requirements discussed in ¶2.2 - 2.16). A taxpayer who is resident in Canada and owns such a qualifying property outside Canada during a particular tax year can designate the property as a principal residence for that year in order to use the principal residence exemption (see ¶2.17 - 2.26 for the meanings of resident in Canada and during). 

https://www.canada.ca/en/revenue-ag...olio-s1-f3-c2-principal-residence.html#N11115


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## barleydrinker (Nov 18, 2017)

I am moving to Canada and want to use the HBP for a home in Canada.

The criteria includes being a "first time buyer" which they define as someone not owning a home in the last 4 years. I live and own my current home, but that home is outside Canada. So, my question is does the home for the first time buyer criteria have to be located in Canada? The home I want to purchase with the HBP will be in Canada.


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## Eclectic12 (Oct 20, 2010)

No expertise ... so all I have to work with is that the HBP home has an extra qualifier of being Canadian while the four year rule bit has no extra criteria. This suggests that owning a home regardless of location is the disqualifying factor.

I doubt many fit your situation so it may be more effective to call CRA or consult a specialist. Or maybe someone who has made a similar move plus inquired about the HBP can comment.


Cheers


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## twa2w (Mar 5, 2016)

If you own a home you do not qualify, regardless of the location of that home. But double check with CRA. They sometimes give surprising answers.
Are you selling your existing home before returning to Canada?


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## barleydrinker (Nov 18, 2017)

twa2w said:


> If you own a home you do not qualify, regardless of the location of that home. But double check with CRA. They sometimes give surprising answers.
> Are you selling your existing home before returning to Canada?


well, that's one other thing I have to deal with.

My instinct is to sell the home. My current market is experiencing some headwinds which I think may last a couple of years. So holding on is a couple of years play.

The other question, unrelated to my original question, is that foreign property is treated as sold and bought at FMV when I enter canada, which I guess is done to calculate future capital gains. However, I know that principle residences in both Canada and where I am have grace periods after leaving a principle residence where capital gains doesn't kick in. I think in canada it is one year, no?

I assume, despite the sold and bought at FMV, that I am still entitled to that grace period.


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