The First Home Savings Account, available since April 2023, combines the best feature of each of the other two registered accounts. Contributions are deductible, like an RRSP, and a qualifying withdrawal to buy a first home is tax-free, like a TFSA. Nothing has to be repaid.
You can contribute $8,000 a year to a lifetime maximum of $40,000. Unused annual room carries forward, but only up to $8,000, and only from the year you open your first FHSA. That combination is why the FHSA is often the first account people fill once a home purchase is on the horizon.
Who can open an FHSA
You need to be a resident of Canada, at least 18, no older than 71 at the end of the year you open it, and a first-time home buyer. For the FHSA, that means that earlier in the year you open the account, and in each of the four calendar years before it, you did not live, as your principal residence, in a home owned by you or by your current spouse or common-law partner.
Owning a home you did not live in, such as a rental property, does not by itself disqualify you. Living in a home your spouse owned does. The FHSA eligibility checker walks through each condition.
Why opening early matters
Carry-forward room only exists once you have an account. Someone who opens an FHSA and deposits nothing still earns the year's $8,000 of room, and it carries into the next year. Someone who waits earns nothing until they open.
| Year | Carried forward | Room available | What happened |
|---|
| 2026 | $0 | $8,000 | Opens an FHSA in December with no deposit |
| 2027 | $8,000 | $16,000 | Unused room from the first year carries forward |
Carry-forward is capped at $8,000, so leaving room unused for two years in a row does not stack beyond $16,000 in the following year.
The deduction
FHSA contributions are deducted on line 208051 of your return. The value is the same as an RRSP deduction of the same size: an $8,000 deduction at $75,000 of taxable income in Ontario saves about $2,522 of 2026 tax, at a marginal rate of 29.65%. Unlike an RRSP deduction, FHSA room does not depend on earned income, so a student or someone between jobs can contribute and save the deduction for a higher-income year.
Qualifying withdrawals
A withdrawal is tax-free if all of these are true when you make it:
- Be a first-time home buyer at time of withdrawal.
- Be a Canadian resident at time of withdrawal and until home acquisition.
- Have a written agreement to buy or build a qualifying home with an acquisition date before October 1 of the year following the withdrawal.
- Intend to occupy the home as principal residence within 1 year of buying or building.
Anything else is a taxable withdrawal: the amount is added to your income and tax is withheld at source.
Using the FHSA with the Home Buyers' Plan
The FHSA and the RRSP Home Buyers' Plan can both be used for the same home. A couple who each max out an FHSA and each use the HBP could draw $40,000 plus growth each from their FHSAs and up to $60,000 each from their RRSPs. The HBP money must be repaid over 15 years; the FHSA money never is. See buying a first home with both.
When the account has to close
The participation period ends at the earliest of:
- 15 years after the year you opened your first FHSA.
- December 31 of the year you turn 71.
- December 31 of the year following your first qualifying withdrawal.
Money that has not been used for a home by then can be transferred to an RRSP or RRIF tax-free without using any RRSP room, or withdrawn as taxable income. The transfer option means an FHSA opened by someone who never buys is, at worst, extra RRSP room. That is the main reason to open one even if a purchase is uncertain.
Transfers from an RRSP
You can move money from an RRSP to an FHSA tax-free, but it uses FHSA room and does not give a second deduction, because the RRSP contribution was already deducted. It can make sense for someone who has RRSP savings but no cash to fund an FHSA.
FHSA questions
How much can I put in an FHSA in 2026?
Up to $8,000 a year, plus up to $8,000 of unused room from earlier years, to a lifetime maximum of $40,000. The most you can contribute in any one year is therefore $16,000.
When does FHSA room start?
In the year you open your first FHSA, not at age 18. Opening an account early, even with no deposit, starts the clock on carry-forward room.
Is there a 60-day grace period for FHSA contributions like the RRSP?
No. The FHSA works on the calendar year, so contributions must be made by December 31 to count for that year. You can, however, carry the deduction forward and claim it in a later year.
Can I use the FHSA and the Home Buyers' Plan for the same home?
Yes. A qualifying FHSA withdrawal and an HBP withdrawal of up to $60,000 can be used together for the same purchase.
What if I never buy a home?
When the participation period ends you can transfer the balance to your RRSP or RRIF tax-free without using RRSP room, or withdraw it as taxable income.
Does my spouse owning a home disqualify me?
It can. You are not a first-time home buyer if, in the current year or the four previous calendar years, you lived as your principal residence in a home that you or your current spouse or common-law partner owned.