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

Yes. CRA allows eligible individuals to make an HBP withdrawal from an RRSP and a qualifying withdrawal from an FHSA for the same qualifying home, provided they meet the conditions for both programs.

Can I use the Home Buyers' Plan again for another property?

Potentially. Your previous HBP balance must be zero on January 1 of the year you make the new withdrawal, and you must meet the other applicable eligibility conditions.

Can I use the HBP to buy a home for a person with a disability?

Yes. The program includes provisions for a specified disabled person. In qualifying situations, the usual first-time home buyer condition may not apply, but the home must meet the relevant accessibility or care requirements.

What happens if I withdraw HBP money but do not complete the home purchase?

You may need to cancel your HBP participation and include the amount withdrawn in your income, unless a permitted exception or replacement-property rule applies. CRA has specific cancellation procedures.

Can I repay my HBP balance before the official repayment period starts?

Yes. You can make repayments early. These payments reduce the amount that will be required in the first scheduled repayment year, although the official 15-year repayment period does not change.

RRSP Home Buyers’ Plan: How Much Can You Withdraw and When Must You Repay It?

Key Takeaways

Eligible Canadians can withdraw up to $60,000 from their RRSPs under the HBP, subject to CRA conditions.
The repayment start date depends on when the first withdrawal was made, with temporary relief extending the start date for eligible participants through 2028.
Missed repayments can become taxable income, making it important to plan the annual amount alongside mortgage expenses.

How Much Can You Withdraw Under the RRSP Home Buyers' Plan?

The Home Buyers' Plan (HBP) lets eligible Canadians withdraw up to $60,000 from their Registered Retirement Savings Plans (RRSPs) to buy or build a qualifying home without including an eligible withdrawal in income at the time. The money is not a grant, however. You must repay it over time, and any required amount you do not repay is generally added to your taxable income.

The repayment schedule depends on when you first used the HBP. For first withdrawals made from January 1, 2022, through December 31, 2028, the 15-year repayment period begins in the fifth year after the withdrawal year. Someone making a first withdrawal in 2026 therefore starts repaying in 2031.

1. Treating the $60,000 Limit as a Per-Account Limit

The $60,000 maximum applies to each participant's total HBP withdrawals for a participation period, not to each RRSP. You can withdraw from more than one RRSP if you are the account annuitant, but the combined eligible withdrawals cannot exceed $60,000.

If two eligible partners are buying a home together, each may be able to withdraw up to $60,000 from their own RRSPs, for a combined $120,000. Each person must independently meet the HBP conditions. Some locked-in or group RRSPs may not permit withdrawals, so check with the plan provider before relying on that balance.

2. Assuming You Qualify Because You Are Buying Your First Home

The HBP has a specific first-time home buyer test. Generally, you must not have lived in a home as your principal residence that you or your current spouse or common-law partner owned or jointly owned during the current calendar year before the withdrawal, excluding the 30 days immediately before it, or during the previous four calendar years.

There are exceptions, including certain situations involving a specified disabled person or people who are living separate and apart from a spouse or partner. Check the CRA criteria rather than relying on the everyday meaning of “first home.”

You must also be a Canadian resident at the time of withdrawal and have a written agreement to buy or build a qualifying home in Canada. Mortgage pre-approval alone is not enough.

3. Withdrawing Before the Purchase Paperwork Is Ready

The written purchase or construction agreement must exist when you make the withdrawal. The home generally must be acquired or built before October 1 of the year after your first withdrawal. You must also intend to occupy it as your principal residence within one year after acquiring it.

For example, if your first HBP withdrawal is made in 2026, the normal acquisition deadline is before October 1, 2027. Special rules can apply to replacement properties or construction delays, so check the CRA guidance if your project changes.

4. Missing the Form T1036 and Withdrawal Window

You must complete Form T1036 and give it to your RRSP issuer. A separate form is required for each withdrawal. Multiple HBP withdrawals are allowed, but normally they must be made in the calendar year of your first withdrawal and in January of the following year.

Do not assume a regular RRSP cash withdrawal automatically qualifies. If the HBP conditions are not met, some or all of the amount may be treated as an ordinary taxable RRSP withdrawal.

5. Misunderstanding the 89-Day Contribution Rule

A common oversimplification is that every RRSP contribution must simply sit for 90 days before an HBP withdrawal. The actual CRA rule is more specific.

Contributions made to the RRSP during the 89 days before the withdrawal may not be deductible to the extent that those contributions exceed the fair market value of the RRSP immediately after the withdrawal. This can affect a recent contribution even when the withdrawal itself qualifies under the HBP.

Before making a large last-minute RRSP deposit to increase the amount available for a home, calculate the potential deduction restriction.

6. Forgetting When Repayments Begin and How Much Is Due

For first withdrawals made between 2022 and 2028, repayment starts in the fifth year after the withdrawal year. Earlier first withdrawals made before 2022 generally follow the older rule, with repayment starting in the second year after the withdrawal year.

The minimum annual repayment is generally the outstanding HBP balance divided by the number of years remaining in the 15-year repayment period. For example, a $30,000 withdrawal with no extra repayments requires $2,000 annually over 15 years. A $60,000 withdrawal would initially require $4,000 per year.

7. Claiming a Deduction or Ignoring a Missed Repayment

To count a contribution as an HBP repayment, make it to your RRSP, PRPP or SPP during the repayment year or in the first 60 days of the following year, then designate it on Schedule 7. Report the repayment on line 24600.

An amount designated as an HBP repayment is not deductible as a regular RRSP contribution, and it does not use your RRSP deduction limit. If you repay less than the required minimum, the shortfall is generally included in your income on line 12900. The same applies if you make no repayment.

TwikUp's Perspective

The HBP can make a home purchase possible sooner, but its real cost is not limited to the cash withdrawn. The repayment schedule competes with mortgage payments, property taxes, maintenance and retirement saving for the same future income.

Before using the full $60,000, model the annual repayment alongside your expected housing costs. Also compare the HBP with an FHSA, which has different contribution and withdrawal rules. The strongest plan is not necessarily the one that produces the largest down payment today. It is the one that leaves enough room in your budget to keep the home and your retirement plans financially sustainable.

For a broader comparison of Canadian savings accounts, read our guide to TFSA vs RRSP vs FHSA vs RESP: Choosing the Right Account by Life Goal.

Disclaimer

This article is for general educational purposes only and does not provide personalized tax, legal or financial advice. HBP eligibility, withdrawal treatment and repayment obligations depend on individual circumstances. Review the latest CRA guidance or consult a qualified tax professional before making a withdrawal.

Sources

Canada Revenue Agency