First Home Savings Account (FHSA): Contribution Limits, Rules and How It Reaches Your Down Payment
The FHSA lets you put away $8,000 a year to a $40,000 lifetime maximum, deduct every dollar from your taxable income the way an RRSP works, and take it all out tax-free for a first home the way a TFSA works. It is the only registered account in Canada that does both. Stacked with the Home Buyers’ Plan, which now allows a $60,000 RRSP withdrawal, two people can reach a $200,000 down payment entirely out of registered money — enough for 20% on a $1,000,000 purchase and no default insurance premium at all.
Apply nowWhat you can contribute, and what carries forward
Your room starts the year you open your first FHSA, not the year you turn 18. That is the single most expensive detail in the rules: an unopened account accrues nothing. Open one with $0 in it and the clock starts.
| Rule | Amount |
|---|---|
| Contribution room, first year open | $8,000 |
| Annual room thereafter | $8,000 plus unused carry-forward |
| Maximum carry-forward into any one year | $8,000 (so $16,000 is the most you can put in during a single year) |
| Lifetime contribution maximum | $40,000 |
Carry-forward is capped. Skip three years and you do not arrive with $24,000 of room — you arrive with $8,000 of carry-forward plus the current year, which is $16,000. Missed room past that cap is gone.
Why it beats an RRSP and a TFSA for this one purpose
An RRSP deduction is a loan from the tax system: you deduct now and pay tax on the way out, which under the Home Buyers’ Plan means repaying the withdrawal over 15 years. A TFSA has no deduction at all. The FHSA is the only one that gives you the deduction and the tax-free withdrawal, with no repayment.
| Deduction going in | Tax on withdrawal | Repayment | |
|---|---|---|---|
| FHSA | Yes | None, for a qualifying home | None |
| RRSP via Home Buyers’ Plan | Yes | None, if repaid | Over 15 years |
| TFSA | No | None | None |
At a 43% marginal rate, a full $8,000 contribution is worth about $3,440 back. That refund is not earmarked — most people put it straight back into the following year’s room, which is how a $40,000 account costs closer to $23,000 of take-home pay.
Stacking the FHSA with the Home Buyers’ Plan
You can use both for the same purchase. The HBP limit is $60,000 per person from your RRSP, and the two withdrawals are assessed separately — meet the conditions for each at the time of each and both are allowed.
There is a timing change worth knowing. Repayment of an HBP withdrawal normally begins in the second year after the year you withdraw. For first withdrawals made between 1 January 2026 and 31 December 2028, that start is deferred to the fifth year. A 2026 withdrawal therefore carries no repayment until 2031 — five years of the money working in the house rather than against the RRSP.
Run the number against a real purchase price with the down payment calculator, and against the price you would actually qualify for with the affordability calculator.
What the down payment buys you at each threshold
How far registered savings get you depends on where the purchase price falls. The minimums are set federally and are not a lender policy:
| Purchase price | Minimum down payment |
|---|---|
| $500,000 or less | 5% |
| $500,000 to $1,500,000 | 5% of the first $500,000, 10% of the rest |
| $1,500,000 or more | 20% |
Default insurance is only available below $1,500,000, and insured purchases amortize over 25 years — 30 is available through CMHC’s Home Start route rather than as a general rule. Crossing 20% down removes the premium entirely, which is the threshold two stacked FHSAs are built to reach.
What a lender wants to see when the down payment is registered money
Registered savings are treated as your own funds, not a gift, which is the easiest category to document. Expect to provide 90 days of account history showing the balance and that it did not arrive as an undisclosed loan. Underwriters are looking for a deposit pattern consistent with your income, not a lump sum that appeared last week.
Withdraw too early and you create a different problem: FHSA money sitting in a chequing account for six months stops looking like registered savings and starts looking like an unexplained deposit. Time the withdrawal to the closing, not to the offer.
If your income is self-employed or commission-based, the documentation standard is different again and worth reading before you shop — see self-employed mortgages.
Where to go next
- First-time home buyer mortgages — the programs and rate shelf that apply to a first purchase.
- Mortgage pre-approval — what a hold actually guarantees before you make an offer.
- Current mortgage rates — today’s board by term and type.
- Lendmax: FHSA and your mortgage — how the account is treated at application.
- Lendmax: first-time home buyer programs.
Common questions
What is the FHSA contribution limit?
$8,000 per year to a $40,000 lifetime maximum. Unused room carries forward, but only $8,000 of carry-forward can be added to any single year, so $16,000 is the most that can go in during one calendar year.
When does my FHSA contribution room start?
The year you open your first FHSA. Room does not accrue before the account exists, which is why opening one with a zero balance is worth doing as soon as you are eligible.
Can I use the FHSA and the Home Buyers’ Plan for the same home?
Yes. The $40,000 FHSA and the $60,000 HBP withdrawal are assessed separately and both can go toward the same qualifying home provided you meet the conditions for each at the time of each withdrawal.
When do I have to repay an HBP withdrawal?
Normally repayment begins in the second year after the year of your first withdrawal, over 15 years. For first withdrawals made from 1 January 2026 to 31 December 2028 the start is deferred to the fifth year, so a 2026 withdrawal is first repaid in 2031.
Is an FHSA withdrawal taxable?
Not for a qualifying first-home purchase. Contributions are deductible going in and a qualifying withdrawal is tax-free coming out, with no repayment obligation. A non-qualifying withdrawal is taxable as income.
How much down payment do I actually need?
5% on a purchase price of $500,000 or less; 5% of the first $500,000 plus 10% of the portion above it between $500,000 and $1,500,000; and 20% at $1,500,000 or more, where default insurance is no longer available.
FHSA contribution room and carry-forward: Canada Revenue Agency. Home Buyers’ Plan limit, 15-year repayment and the 2026–2028 deferral: Canada Revenue Agency. Minimum down payment tiers: Financial Consumer Agency of Canada. Amortization and the $1,500,000 insurance ceiling: CMHC. Verified 4 November 2026.
Know what the down payment actually qualifies you for?
When you are ready to do something with these numbers, we will introduce you to a licensed broker who can put the file in front of lenders. Nothing here obliges you to.
