How to Use the FHSA and RRSP Home Buyers' Plan Together to Buy Your First Home in Canada

You’ve been saving for a while, and the idea of buying your first home is starting to feel real — not just a daydream. The problem is that Canadian home prices make the down payment feel impossible, and everyone has a different opinion on the best way to save. Here’s the thing: there are two powerful government-backed accounts designed specifically to help you do this, and they work even better when you use them together. The FHSA (First Home Savings Account) and the RRSP Home Buyers’ Plan are not competing options — they’re a stack. If you’re a first-time buyer between 19 and 40, understanding how they work together could meaningfully change how much you can put down on your first place.

Quick answer: You can use both the FHSA and the RRSP Home Buyers’ Plan (HBP) at the same time when buying your first home. The FHSA lets you withdraw up to $40,000 tax-free with no repayment requirement. The HBP lets you borrow up to $60,000 from your RRSP, which you repay over 15 years. Together, that’s up to $100,000 per person (or $200,000 for a couple) toward a down payment.

How Does the FHSA Work in Canada?

The FHSA is a registered account where your contributions are tax-deductible and your withdrawals for a first home purchase are completely tax-free. You can contribute up to $8,000 per year with a lifetime limit of $40,000. Unused contribution room carries forward by one year, so if you opened your FHSA in 2024 and contributed nothing, you’d have $16,000 of room in 2025.

To be eligible, you need to be a Canadian resident, at least 18 years old (or the age of majority in your province), and you must not have lived in a home you owned in the current year or in any of the four preceding calendar years. That last part is the official definition of “first-time buyer” for FHSA purposes, and it applies each year you hold the account.

The money inside your FHSA can be invested — you’re not limited to a savings account. You can hold ETFs, stocks, GICs, and mutual funds the same way you would in a TFSA or RRSP. Platforms like Wealthsimple and Questrade both offer FHSAs, and if you’re in the accumulation phase with a few years to go before buying, investing the balance in a low-cost index ETF can help it grow.

When it’s time to buy, you fill out Form RC725 and withdraw everything tax-free. No repayment. No catch.

Quick tip: Open an FHSA even if you’re not sure you’ll buy in the next year or two. Contribution room only starts accumulating once the account is open, and you can invest the balance in the meantime.

How Does the RRSP Home Buyers’ Plan Work?

The Home Buyers’ Plan lets you withdraw up to $60,000 from your RRSP to buy or build a qualifying first home. This limit increased from $35,000 to $60,000 in 2024, making it a much more meaningful tool than it used to be. Unlike the FHSA, the HBP is a loan from yourself — you need to start repaying the amount withdrawn back into your RRSP starting in the second year after the year you made the withdrawal, over a 15-year period.

If you withdraw $60,000 through the HBP, you’ll repay roughly $4,000 per year back into your RRSP for 15 years. If you miss a repayment in any given year, that missed portion gets added to your taxable income for that year — so it’s important to track it. CRA will send you a statement each year showing how much you owe.

To qualify for the HBP, the RRSP funds you’re withdrawing must have been in the account for at least 90 days before the withdrawal. That means you can’t contribute $60,000 to your RRSP on January 1st and withdraw it on January 3rd — you’d need to wait at least 90 days from the contribution date.

How Do You Combine the FHSA and HBP for Maximum Impact?

Using both accounts together is straightforward — CRA explicitly allows it. Here’s how the math works for a single buyer maxing out both: $40,000 from the FHSA (tax-free, no repayment) plus $60,000 from the RRSP via the HBP (repaid over 15 years) gives you $100,000 toward a down payment. For a couple who are both first-time buyers, you’re looking at $200,000 combined.

The key is sequencing. Your FHSA should be opened and contributed to as early as possible, since the $8,000 annual limit means it takes at least five years to reach the $40,000 lifetime max. Your RRSP should be funded with the 90-day rule in mind — if you’re planning to buy within the next six months, don’t count on contributions you haven’t made yet.

From a tax perspective, both FHSA contributions and RRSP contributions reduce your taxable income in the year you make them. That means if you’re contributing to both in a higher-income year, the tax refund you get back can itself be redirected into savings — a useful loop.

One thing to watch: the first-time buyer definition applies separately to the FHSA and the HBP. Both use the same four-year look-back rule (you can’t have owned a home you lived in during the current year or the four preceding years), so if you qualify for one, you almost certainly qualify for both.

What Happens After You Buy?

Once you’ve made the purchase, the FHSA is closed and the withdrawals are done — there’s nothing to repay. For the HBP, repayments start in the second year after the withdrawal year. CRA sends you a Home Buyers’ Plan Statement of Account each spring showing your required repayment for the year. You make that repayment by contributing to your RRSP and designating it as an HBP repayment on your tax return (Schedule 7).

If you withdraw $60,000 but only have $45,000 in your RRSP at the time, you can still use the HBP — you just withdraw what’s there. You can also make multiple HBP withdrawals across different RRSPs as long as the total doesn’t exceed $60,000 and all withdrawals happen before October 1st of the year after you sign the purchase agreement.

For couples buying together, each partner must qualify independently as a first-time buyer, and each submits their own HBP request. The $60,000 limit applies per person, not per household.

Frequently Asked Questions

Can I use both the FHSA and the RRSP Home Buyers’ Plan at the same time?

Yes, you can use both on the same qualifying home purchase. The FHSA withdrawal is tax-free with no repayment required, while the HBP withdrawal from your RRSP must be repaid over 15 years. There is no rule preventing you from using both — CRA has confirmed this is permitted.

What is the maximum I can withdraw using both accounts?

A single first-time buyer can withdraw up to $40,000 tax-free from the FHSA and up to $60,000 from their RRSP via the Home Buyers’ Plan, for a combined maximum of $100,000. A couple where both partners qualify as first-time buyers can access up to $200,000 combined.

Do FHSA withdrawals have to be repaid?

No. When you withdraw from your FHSA for a qualifying first home purchase, it is completely tax-free and there is no repayment requirement. This is the main advantage of the FHSA over the RRSP Home Buyers’ Plan, which functions as a loan from yourself that you repay over 15 years.

What happens if I don’t repay my RRSP Home Buyers’ Plan withdrawal?

If you miss your required annual HBP repayment, that missed amount is added to your taxable income for the year. For example, if your required repayment is $4,000 and you don’t make it, that $4,000 is taxed as income in that year. It does not go away — it just becomes taxable rather than being credited as an RRSP contribution.

Can I contribute to my RRSP and withdraw it right away for the Home Buyers’ Plan?

No. RRSP funds must be in the account for at least 90 days before you withdraw them under the Home Buyers’ Plan. Any contribution made less than 90 days before the withdrawal date is ineligible. Plan ahead — if you’re contributing specifically to use the HBP, make those contributions at least three months before you need the funds.

If you want more detail on how each account works on its own, check out FHSA explained: the new first home savings account for Canadians, The Complete RRSP Guide for Canadians, and FHSA vs TFSA: when to use which for your first home.

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