FHSA and Home Buyers' Plan: Using Both in 2026

For a first-time buyer in the Lower Mainland, the two federal savings tools, the First Home Savings Account (FHSA) and the RRSP Home Buyers' Plan (HBP), can make a real difference to your down payment. They work differently, have different conditions, and can be used together. This guide sets the FHSA and Home Buyers' Plan side by side, using the Canada Revenue Agency's own rules, so you can see what each does and where the traps are.

The FHSA and Home Buyers' Plan at a glance

	FHSA	RRSP Home Buyers' Plan
What it is	A registered account to save for a first home	A way to withdraw from your existing RRSP for a first home
Limit	$8,000 a year, $40,000 lifetime (contributions)	$60,000 withdrawal
Tax on contributions	Generally deductible	RRSP contributions are deductible as usual
Pay it back?	No, a qualifying withdrawal is not repaid	Yes, over 15 years
First-time test	4-year test	4-year test

Yes. The CRA says you can withdraw from your RRSP under the HBP and make a qualifying withdrawal from your FHSA for the same qualifying home, as long as you meet all of the conditions at the time of each withdrawal. That comes from the CRA's Home Buyers' Plan page (modified February 17, 2026).

How the FHSA works

The CRA describes the FHSA as a registered plan that lets first-time buyers "save to buy or build a qualifying first home tax-free." Contributions are generally deductible, like an RRSP, and a qualifying withdrawal for a home is not taxed, like a TFSA.

Who can open one

Per the CRA's opening an FHSA page, you must be a resident of Canada, at least 18, and no older than 71 as of December 31 of the year you open it. The CRA notes that in provinces where the legal age to enter a contract is 19, as in BC, that affects when you can open one, so check with your issuer. You must also meet the first-time buyer test, covered below.

Contribution room

Your FHSA participation room is $8,000 in the year you open your first FHSA, with a lifetime limit of $40,000. Unused room carries forward to the next year, up to a maximum carry-forward of $8,000. The CRA's contributing page adds two details worth knowing:

Carry-forward only starts once you have opened an FHSA. Room doesn't build up while you think about it.
Over-contributing costs 1% per month on the highest excess amount.

Taking the money out for your home

For a withdrawal to be tax-free, the CRA's withdrawals page lists conditions that must all be met:

You are a first-time home buyer at the time of the withdrawal. The 30 days immediately before the withdrawal are excluded.
You have a written agreement to buy or build a qualifying home, with acquisition or completion before October 1 of the year after the withdrawal.
You did not acquire the home more than 30 days before the withdrawal.
You are a resident of Canada from your first qualifying withdrawal until you acquire the home.
You occupy, or intend to occupy, the home as your principal residence within one year of buying or building it.
You fill out Form RC725 and give it to your FHSA issuer.

The CRA says the account should be closed by December 31 of the year after your first qualifying withdrawal. Money you don't use for a home can be transferred to your RRSP using Form RC721, without immediate tax.

How the Home Buyers' Plan works

The CRA says the HBP withdrawal limit is currently $60,000. The limit applies per person, so two qualifying buyers can each withdraw from their own RRSPs. The CRA's participation conditions include:

being a resident of Canada when you withdraw;
having a written agreement to buy or build a qualifying home at the time of withdrawal;
intending to occupy it as your principal residence within one year of buying or building it;
acquiring the home before October 1 of the year after your first withdrawal.

The 90-day rule

RRSP contributions made within 90 days before an HBP withdrawal can't be withdrawn under the plan. If you plan to top up your RRSP before you buy, do it early.

Repayment and the extended relief

Repayments are normally spread over 15 years. Under temporary relief, if your first HBP withdrawal is between January 1, 2026 and December 31, 2028, repayment starts in the fifth year after the withdrawal. The CRA's example: a first withdrawal in 2026 means a first repayment year of 2031. Earlier relief covered first withdrawals from 2022 to 2025. Many guides still say repayment starts in the second year. That is the standard rule, but it doesn't apply to first withdrawals in the relief periods.

"First-time buyer" means different things in different programs

Both use a four-year test. You generally qualify if you did not live in a home you owned or jointly owned as your principal residence in the current calendar year or the previous four calendar years. Your spouse's or common-law partner's ownership also counts.

BC's property transfer tax exemption is much stricter: you must never have owned a principal residence anywhere in the world. You can qualify for the FHSA and HBP but not for the BC exemption. If you owned a home years ago, check each program separately. Our guide to the first time home buyer exemption BC covers the provincial rules.

Using the FHSA and Home Buyers' Plan together

Because both can go toward the same home, a single qualifying buyer could combine FHSA savings (up to $40,000 in contributions, plus any growth) with an HBP withdrawal of up to $60,000. Two qualifying buyers can each use their own accounts. Some practical points:

Timing matters. Both need a written agreement, and both have October 1 deadlines tied to the withdrawal year. Line the withdrawals up with your purchase contract and completion date.
Repayment differs. The FHSA withdrawal is not repaid. The HBP is a loan to yourself that has to go back into your RRSP on the CRA's schedule. Build that future repayment into your budget.
Proof of funds. Lenders will want to see where the down payment came from. Keep statements showing the FHSA and RRSP withdrawals landing in your account.

Which to use first, and how much to draw, depends on your tax bracket, existing RRSP balance and timeline. That is a conversation for a tax adviser. We can show you how the resulting down payment changes your mortgage. See how much down payment you need in BC and try the affordability calculator.

Next steps for Lower Mainland buyers

If you haven't opened an FHSA yet and expect to buy in the next few years, the CRA rules mean the clock on carry-forward room only starts when you open one. Then talk to us about pre-approval so your savings plan matches a real price range. Our first-time home buyer mortgage page and first-time buyer FAQ are good places to start, or book through mortgage pre-approval. Blue Sky Mortgage Group is a licensed BCFSA mortgage brokerage in Richmond: 778-991-3289.

Frequently asked questions

Can I use the FHSA and Home Buyers' Plan for the same home?

How much can I contribute to an FHSA?

Your FHSA participation room is $8,000 in the year you open your first FHSA, with a lifetime limit of $40,000. Unused room carries forward to the next year, up to a maximum carry-forward of $8,000.

How much can I take out under the Home Buyers' Plan?

The CRA says the HBP withdrawal limit is currently $60,000. The limit applies per person, so two qualifying buyers can each withdraw from their own RRSPs.

When do I have to repay the Home Buyers' Plan?

Who counts as a first-time home buyer for the FHSA and HBP?

Rules from the Canada Revenue Agency (FHSA pages updated February 2026; HBP page modified February 17, 2026), checked October 2026.

This is general information, not financial or tax advice. Speak to a licensed mortgage professional and a qualified tax adviser about your situation.

Using the FHSA and Home Buyers' Plan