First Home Savings Account (FHSA)

A New Tax-Free Way To Help Save For Your First Home

What is the FHSA?

The First Home Savings Account (FHSA) is a new type of registered plan that’s designed to help you save for your first home, tax-free. Your contributions will be tax-deductible, like a registered retirement savings plan (RRSP). Your qualifying withdrawals will be non-taxable, like a tax-free savings account (TFSA).

Why you should consider opening an FHSA?

Get started on your journey to owning your first home. The First Home Savings Account – is a government-registered, tax-free investment savings account to which you can contribute up to a lifetime maximum of $40,000 towards the purchase of your first home. Contributions are tax-deductible and savings growth is tax-free.

Get tax benefits - Your FHSA contributions can reduce your taxable income.
Grow your savings, tax-free - Any investment income in your FHSA is non-taxable while it’s in your plan.
Save for your first home, tax-free - Pay no taxes on your withdrawals when you use your FHSA towards the purchase of a qualifying home.

Who is eligible to open an FHSA?

The federal government has provided criteria for who can open an FHSA and what counts as a qualifying withdrawal.

How do you qualify to open an FHSA?

You're a Canadian resident and you've reached the age of majority in your province or territory.
Must be under 71 years of age as of December 31 of the current year.
You're an eligible first-time homebuyer who hasn’t lived in a qualifying home in the current or past 4 calendar years.

What is the Contribution Room for a FHSA?

You can contribute up to $8,000 per year to your FHSA, for a maximum of $40,000 during your lifetime.

You can also carry forward up to $8,000 of unused contribution room from one year to the next, for a maximum annual contribution of $16,000.

When is the Contribution Deadline?

The FHSA contribution deadline is December 31 of each year. Unlike with the RRSP, you cannot contribute to your FHSA until the following March 1.

Frequently Asked Questions

Common Questions about the First Home Savings Account.

How do I open an FHSA?

You can visit our branch or call our Contact Centre at 250-494-7181.

What is the definition of a first-time home buyer?

For the purposes of opening an FHSA an individual will be considered a first-time home buyer if they did not, at any time in the current calendar year before the account was opened or at any time in the preceding four calendar years, live in a qualifying home as their principal residence, that:

they owned, or
their spouse or common-law partner owned, or
they owned jointly with their spouse or common-law partner

Note, the Income Tax Act (ITA) makes reference to any principal residence regardless of location. If you are unsure of your eligibility due to home ownership in another country, consult with CRA before opening an FHSA.

For more information, visit the Government of Canada website.

Can I carry forward unused contribution room to future years?

Yes, you can carry forward any unused contributions up to $8,000 in any year. Your carry-forward amounts will only start accumulating once you've opened an FHSA for the first time.

How is the FHSA different from the RRSP Home Buyers' Plan?

With the RRSP Home Buyers' Plan, a planholder can withdraw up to $35,000 from their RRSP. The funds must be repaid to the RRSP over 15 years otherwise the withdrawal will be considered taxable income.

With the FHSA all funds can be withdrawn from the plan and do not have to be repaid if used for a first home purchase.

What types of investments can be held in a FHSA?

An FHSA is permitted to hold the same types of qualified investments that are currently allowed in a TFSA and RRSP, including mutual funds, publicly traded securities, government and corporate bonds, guaranteed investment certificates (GICs) and savings accounts. You will not be able to hold private securities or private placements in an FHSA.

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