FHSA or Home Buyers’ Plan? Understand the Two First-Home Tools

Compare the two programs

The first home savings account, or FHSA, and the Home Buyers' Plan, or HBP, can both help an eligible buyer assemble a down payment. They work differently enough that a combined “first-time buyer” checklist can miss important details.

These are federal programs, so the core rules also apply to eligible buyers in Calgary and Grande Prairie. This overview was checked against official guidance on October 2, 2026. Confirm your circumstances with the account issuer and a qualified tax professional before moving money.

The FHSA builds a dedicated savings pool

An FHSA starts with $8,000 of participation room in the year the first account is opened. Contributions are generally deductible; a direct RRSP transfer does not create another deduction. The usual annual limit is $8,000 and the lifetime limit is $40,000, with up to $8,000 of unused participation room carried forward. Room begins accumulating after opening, rather than automatically when someone becomes old enough. See the CRA FHSA overview and Finance's program summary.

Opening eligibility includes Canadian residency, being at least 18, being no older than 71 at the end of the opening year, and satisfying the first-time-buyer test. That test looks at the current and preceding four calendar years and can include a home owned by a spouse or common-law partner. Review CRA's opening conditions, particularly after a relationship or residency change.

Sources: CRA: First home savings account; Finance: Tax expenditures report, FHSA program summary; CRA: Opening your FHSAs

A qualifying withdrawal has its own test

FHSA opening eligibility does not automatically establish withdrawal eligibility. The withdrawal test differs, including its treatment of a spouse's ownership. Other conditions concern a written purchase or construction agreement, timing, residency and intended principal-residence occupancy.

A qualifying FHSA withdrawal is tax-free and does not have to be repaid. CRA says there is no minimum holding period for contributions before a qualifying withdrawal. Ordinary taxable withdrawals have different consequences. Use the issuer's qualifying-withdrawal process and check CRA's full withdrawal conditions before releasing funds.

Sources: CRA: Withdrawals and transfers out of your FHSAs

The HBP uses retirement savings

The HBP permits eligible withdrawals of up to $60,000 from the participant's RRSPs, with repayment over a period of up to 15 years. Its conditions include a qualifying home, a written agreement and the applicable first-time-buyer and residency tests. Exceptions exist for certain disability-related circumstances. CRA also permits using HBP and qualifying FHSA withdrawals for the same home when each program's conditions are met, as confirmed in its HBP overview. Read HBP participation rules.

Repayments designated to the HBP are not a fresh RRSP deduction. A required repayment shortfall generally becomes taxable income. Build the future repayment obligation into the ownership budget alongside the mortgage and other costs. CRA provides the repayment process and account information.

Sources: CRA: How to participate in the HBP; CRA: HBP repayment; CRA: HBP overview and extended repayment relief

Check the repayment-start date carefully

CRA's current HBP overview confirms extended repayment relief for first withdrawals from January 1, 2026 through December 31, 2028. The 15-year repayment period begins in the fifth year following the first withdrawal; its example gives 2031 for a first withdrawal in 2026. Check your personal CRA repayment schedule and keep the eventual obligation in your budget even during the deferral.

Sources: CRA: HBP overview and extended repayment relief

Compare the whole plan

Make a simple list of each account balance, available room, withdrawal timing and future obligation. Keep expected tax savings separate from cash already available for closing. A possible refund does not pay a deposit that is due before it arrives.

For a purchase approaching quickly, ask the issuer about processing time and investments that must be sold. For a longer timeline, consider liquidity and investment risk with an appropriate adviser. The most useful comparison is how each program fits the actual purchase and the years after it, rather than which has the largest headline limit.