The First Home Savings Account combines the best features of an RRSP and a TFSA: contributions are tax-deductible like an RRSP, and qualifying withdrawals for a first home are tax-free like a TFSA. For 2026, the annual contribution limit is $8,000 with a $40,000 lifetime cap.
Eligibility is straightforward: you must be 18–71, a Canadian resident, and a first-time homebuyer (no home ownership in the current or previous four calendar years). The account stays open for up to 15 years or until the end of the year you turn 71.
Limits and the carry-forward quirk
| Rule | Detail |
|---|---|
| Annual limit | $8,000 per year |
| Lifetime limit | $40,000 total |
| Carry-forward | Unused annual room carries forward, max $8,000 (so max $16,000 in one catch-up year) |
| No carry-forward before opening | Room only starts accruing the year you open the account — open one early even with $0 |
| Account lifespan | 15 years max, or to year-end you turn 71 |
Open it now, fund it later: FHSA room only accrues from the year you open the account. Opening with $0 today starts the clock on carry-forward room you can use later.
Qualifying withdrawals
To withdraw tax-free you must be a first-time homebuyer acquiring a qualifying home in Canada, and you must move in within one year. Unlike the Home Buyers' Plan, FHSA withdrawals are never repaid — the money is simply yours. If you do not buy, unused FHSA funds can transfer to your RRSP/RRIF tax-free (using RRSP room, but without affecting the lifetime FHSA cap math against you).
Stacking with the Home Buyers' Plan
Yes — you can use both: up to $40,000 lifetime from the FHSA plus up to $60,000 from the RRSP via the Home Buyers' Plan ($120,000 per couple). That is potentially $100,000 per person of tax-advantaged down payment. The HBP portion must be repaid over 15 years; the FHSA portion does not.
Frequently asked questions
What is the FHSA contribution limit for 2026?
$8,000 per year with a $40,000 lifetime maximum. Unused annual room carries forward up to $8,000, so you can contribute up to $16,000 in a catch-up year.
Who qualifies for an FHSA?
Canadian residents aged 18–71 who are first-time homebuyers — meaning no home ownership in the current or previous four calendar years.
Do FHSA withdrawals have to be repaid?
No. Qualifying withdrawals for a first home are tax-free and never repaid — a key advantage over the RRSP Home Buyers’ Plan, which requires 15-year repayment.
Can I use both the FHSA and the Home Buyers’ Plan?
Yes. Up to $40,000 lifetime from the FHSA plus up to $60,000 from the RRSP via the HBP ($120,000 per couple) can combine toward one down payment.
What happens if I never buy a home?
Unused FHSA funds can be transferred to your RRSP or RRIF on a tax-free basis, so the contributions are not wasted.
Sources and methodology
- National Home Realty: First-Time Home Buyer Ontario 2026 (FHSA + HBP + LTT Rebate)
- McDadi: First-time home buyer incentives in Ontario for 2026
- HousingPortal: FHSA Rules and Eligibility (2026 Guide)
This article provides general information for planning purposes, not professional advice or a quote. Cost figures are NorthPeak planning estimates unless a source is named; confirm current prices with licensed local contractors and professionals before making decisions.