Canada's First Home Savings Account (FHSA)

The FHSA is a new tax-free savings plan proposed in the 2022 Federal budget to help Canadians save for their first home. Even if you already own a home, these new accounts are very generous and should be used whenever possible. For example, opening an account for your adult children would be a great strategy. These accounts will be available later this summer once the government and financial institutions are ready.

​

What is an FHSA?

These new accounts will give prospective first-time home buyers the ability to save $40,000 on a tax-free basis, combining the most attractive features of an RRSP and a TFSA – your contributions are deductible (like an RRSP) and withdrawals to purchase a first home will be non-taxable and you are not required to refund the amount (like a TFSA) – the best of both worlds!

​

What are the basic rules?

• You must be a resident of Canada and be at least 18 years of age.

• You qualify as a first-time home buyer if you or your partner have not owned a home in the preceding 4 calendar years.

• The annual contribution limit is $8,000.

• The lifetime contribution limit is $40,000.

• You can carry-forward unused contribution room.

• You can only keep an FHSA open for 15 years.

• Any savings not used to purchase a home can be transferred into an RRSP and not count to RRSP contribution room.
   

How does the FHSA differ from the Home Buyers Plan?

With the Home Buyers Plan, first-time home buyers can withdraw up to $35,000 from their RRSP’s, then must pay back the funds to their RRSP over a 15-year period. With an FHSA, the money contributed can grow to an unlimited amount for use to buy a home, and it does not have to be paid back.

If you would like to know when the program is launched join our mailing list.