Buying, Building and Selling Houses: GST/HST

A February 2, 2026 Tax Court of Canada case examined whether spouses who repeatedly purchased, built and sold homes were considered builders for GST purposes.

Over an 11-year period from 2010 to 2021, the taxpayers purchased seven homes and sold five, including several homes built on vacant land.

CRA assessed approximately $22,875 of GST relating to one property.

Were They Builders?

The taxpayers argued that they were not builders.

Alternatively, they argued that the property had been constructed primarily as their family residence and therefore qualified for the personal-use exception.

Taxpayers Lose: Builder Classification

The court focused on:

• The frequency of similar transactions.
• The relatively short ownership and occupancy periods.
• The taxpayers' familiarity with constructing and selling homes.
• The history of selling properties for profit.

The taxpayers argued that they sold the home because its bedroom configuration was unsuitable for their toddler.

The court found that explanation unconvincing given their involvement in designing and constructing the property.

The taxpayers were therefore considered builders.

Personal-Use Exception Also Denied

The court concluded that the primary purpose of the property was to hold it as inventory for sale rather than as a genuine long-term family residence.

Although the taxpayers had lived in the home temporarily, their occupancy was considered incidental to a broader pattern of residential development and resale.

The court upheld CRA's GST assessment using an appraised property value of approximately $915,000.

Action: Repeatedly buying or building homes, briefly occupying them and then selling them for profit may result in an individual being treated as a builder for GST/HST purposes.