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FHSA

Open the Door to Your First Home! Start with an FHSA Today.

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The First Home Savings Account (FHSA) is a registered account designed to help Canadians save for their first home with both tax deductions and tax-free withdrawals.

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Key Benefits:

  • Tax Deductible Contributions: You can contribute up to $8,000 per year, with a lifetime limit of $40,000. Contributions reduce your taxable income, like an RRSP.
  • Tax-Free Growth and Withdrawals: Investment income grows tax-free, and withdrawals for a qualifying first home are also tax-free, like a TFSA.
  • Carry Forward Room: Unused annual contribution room (up to $8,000) can be carried forward to future years.
  • Eligibility: Open to Canadian residents aged 18 or older who haven’t owned a home in the current or previous four years.
  • 15-Year Limit: The account can stay open for up to 15 years or until the end of the year you turn 71, whichever comes first.
  • No Repayment Required: Unlike the RRSP Home Buyers’ Plan, FHSA withdrawals for a first home purchase do not need to be repaid.

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The FHSA combines the best features of RRSPs and TFSAs, making it a powerful, tax-efficient way to save for your first home and reach this important financial milestone sooner.

Also read

RRSP
RESP
TFSA
Support

Frequently asked questions (FAQ)

Can I use my FHSA to purchase a home with someone else who also has an FHSA?

Yes, each eligible buyer can use their own FHSA funds toward the same qualifying home purchase, maximizing your combined tax-free savings.

Can I transfer funds from my RRSP or TFSA into my FHSA?

No, you cannot transfer funds directly from your RRSP or TFSA into your FHSA. Contributions to an FHSA must be made with new deposits, although you can transfer funds between FHSAs held at different institutions.

How long can I keep my FHSA open?

You can keep your FHSA open for up to 15 years after opening it, until the end of the year you turn 71, or until the end of the year following your first qualifying withdrawal—whichever comes first.

What factors should I consider when choosing an insurance policy?
Consider your financial goals, current and future financial obligations, health status, and budget when choosing an insurance policy.
What are the different types of investment options available?
Investment options include stocks, bonds, mutual funds, real estate, and retirement accounts.
Can I make a withdrawal from my FHSA for a home purchase outside of Canada?

No, FHSA withdrawals must be used for the purchase or construction of a qualifying home located in Canada.

Can I use my FHSA funds for a down payment if I’ve already owned a home in the past?

No, you must be a first-time home buyer, which means you (and your spouse or common-law partner, if applicable) have not owned a home that you lived in as your principal residence in the current or previous four calendar years.

Can I re-contribute amounts withdrawn from my FHSA if I don’t end up buying a home?

No. Once you withdraw funds from an FHSA, you cannot re-contribute that amount, even if the withdrawal was not used for a home purchase.

How can I start investing with a small amount of money?
You can start investing with a small amount of money by using a micro-investing app, investing in low-cost index funds, or starting a retirement account.
What are the tax implications of different investment options?
Different investment options have different tax implications. For example, capital gains on stocks are taxable, while investments in retirement accounts may offer tax advantages.
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