Can I Use the FHSA and the RRSP Home Buyers' Plan Together to Buy a House in Ontario?
Yes, you can use the FHSA and the RRSP Home Buyers' Plan together for the same qualifying home, as long as you meet all the conditions at the time of each withdrawal. In practice, that means two sources can go toward one down payment.
The Home Buyers' Plan withdrawal limit is currently $60,000, and withdrawn amounts must be repaid to your RRSP over up to 15 years. An FHSA qualifying withdrawal is tax-free and does not have to be repaid, but only if you are a first-time home buyer, have a written agreement to buy or build a qualifying home, and file Form RC725 with the issuer.
FHSA participation room is $8,000 in the year you open your first FHSA, with a lifetime limit of $40,000. If any FHSA withdrawal condition is not met at the time of withdrawal, the amount is taxable and must be included in income. Because the two programs have their own conditions, check each one before you withdraw, and confirm your situation with a lawyer or accountant.
Key takeaways
- The FHSA and the Home Buyers' Plan can be used together for the same qualifying home.
- You must meet all the conditions of each program at the time of each withdrawal.
- The Home Buyers' Plan withdrawal limit is currently $60,000 and must be repaid to your RRSP over up to 15 years, while a qualifying FHSA withdrawal does not have to be repaid.
- If an FHSA withdrawal condition is not met when you withdraw, the amount is taxable and included in income.