How Much You Can Withdraw
Eligible first time buyers can withdraw up to a set limit per person from their RRSP under the Home Buyers Plan, tax free, as long as the funds have been in the RRSP for at least 90 days before withdrawal. Couples can each withdraw their own limit, effectively doubling the amount available.
Who Qualifies
You generally need to be considered a first time buyer, meaning you or your spouse have not owned a home that was your principal residence in the preceding period defined by the program. There are some exceptions for those going through separation or divorce.
Repayment Rules
Withdrawn funds must be repaid to your RRSP over a set number of years, starting the second year after your withdrawal. Missing a required repayment means that amount gets added to your taxable income for that year.
- Repayment period spans multiple years
- Repayments start the second year after withdrawal
- Missed repayments become taxable income
Combining With Other Programs
The Home Buyers Plan can be used alongside FHSA savings and regular savings, giving buyers multiple ways to reach their down payment goal. Just be mindful of the 90 day holding requirement if you are contributing shortly before buying.
Planning Ahead
Because of the 90 day rule, it helps to plan your RRSP contributions well before you expect to buy, rather than scrambling to contribute right before your closing date.
Frequently asked questions
- How long do I have to repay my Home Buyers Plan withdrawal?
- Repayment is spread over a set number of years, generally starting in the second year after withdrawal.
- Can my spouse and I both use the Home Buyers Plan?
- Yes, each eligible person can withdraw up to their own limit from their individual RRSP.
- What happens if I miss a repayment?
- The missed amount is added to your taxable income for that year instead of being repaid to your RRSP.