How the FHSA and the RRSP compare for a home
The deduction works the same way in both. The differences are in how much room you get, what happens when you take the money out for a home, and what happens if you never buy.
| FHSA | RRSP with the HBP | |
|---|---|---|
| New room each year | $8,000, from the year you open the account | 18% of last year's earned income, up to $33,810 for 2026 |
| Unused room | Carries forward, but only up to $8,000 | Carries forward in full |
| Total for a home | $40,000 of contributions, plus growth | Up to $60,000 withdrawn |
| Contributions in January and February | Can't go on last year's return; deduct that year or carry the deduction forward | Deductible for the year before, until the RRSP deadline |
| Withdrawal for a first home | Tax-free, never repaid | Tax-free, repaid over 15 years; a missed year is added to your income |
| If you never buy | Transfer to your RRSP without using RRSP room, or withdraw as taxable income | Stays in the RRSP for retirement |
| Time limit | Ends in the year of the 15th anniversary of opening, the year you turn 71, or the year after your first home withdrawal, whichever is first | Contributions until the end of the year you turn 71 |
Why the FHSA usually goes first
A dollar in the FHSA gets the same deduction as a dollar in the RRSP, and it comes out for the house with no repayment schedule attached. Money taken from an RRSP under the HBP is effectively a loan from your future retirement: every year you don't repay the minimum, that amount is added to your taxable income.
The downside if you change your mind is small. A direct transfer from an FHSA to an RRSP is tax-free and doesn't touch your RRSP deduction room, so FHSA money you never use for a home ends up where it would have been anyway, with the extra room on top.
Open the account early, even with nothing to put in. FHSA room only starts the year you open your first FHSA, and unused room carries forward only up to $8,000, so an empty account stops building room after its second year.
FHSA room available each year if nothing is contributed
Unused room carries forward, but only up to $8,000. After the second year, leaving an FHSA empty stops adding room.
Example: an FHSA opened in year 1 with no contributions| Item | Value |
|---|---|
| Year 1 | $8,000 |
| Year 2 | $16,000 |
| Year 3 | $16,000 |
| Year 4 | $16,000 |
| Year 5 | $16,000 |
The trade-off is the clock: opening the account also starts the 15-year limit. Anything left at the end has to move to an RRSP or RRIF, or come out as taxable income.
When the RRSP should come first
- You want last year's deduction. FHSA contributions have no 60-day window: one made in January or February can't go on last year's return (it can be deducted that year, or carried forward). If you're topping up before the RRSP deadline to lower last year's tax, it has to go to the RRSP.
- Your employer matches group RRSP contributions. A match is extra money the FHSA can't give you, so contribute enough to get it first.
- You've used this year's FHSA room. Past $8,000 plus your carry-forward, the RRSP is the next place for deductible savings, and the HBP lets you use it for the same home.
- You're not eligible for an FHSA. To open one you must not have lived, in that year or the previous four, in a home that you or your spouse owned. The HBP has its own first-time buyer test, checked when you withdraw.
Moving RRSP money into an FHSA is allowed, but it isn't a shortcut. The transfer uses FHSA room and gives no new deduction, since you already deducted that money when it went into the RRSP. It does turn money that would have to be repaid under the HBP into money that never does.
Using the FHSA and the HBP for the same home
CRA allows both for one qualifying home, as long as you meet each account's conditions when you make each withdrawal. For the FHSA that includes a written agreement to buy or build the home before October 1 of the year after the withdrawal, and an intention to live in it within a year. Couples can each use their own: $200,000 between two first-time buyers, before growth.
Worked example. You open an FHSA in 2026 and contribute $8,000 a year. It reaches the $40,000 limit in 2030, the year you buy. You also withdraw $25,000 from your RRSP under the HBP.
| Source | Amount for the home | What you owe back |
|---|---|---|
| FHSA (2026 to 2030) | $40,000 plus growth | Nothing |
| RRSP under the HBP | $25,000 | At least $1,667 a year from 2032, the first due by March 1, 2033 |
Two timing rules catch people. An RRSP contribution made in the 89 days before an HBP withdrawal can lose its deduction if the withdrawal takes it straight back out, so get the money in at least 90 days ahead. And HBP repayments go back into an RRSP, never into an FHSA. The HBP repayment guide covers the schedule year by year.
Keep both accounts' room in one place
An FHSA and an RRSP have different rules for room, carry-forward and deadlines, and it's easy to lose track across institutions. Looniee's Planner records FHSA, RRSP and HBP entries and shows the room left in each. It's on the free plan, and Looniee never asks for a bank login.
For the numbers on their own, use the FHSA contribution room calculator, the RRSP contribution limit calculator and the Home Buyers' Plan repayment calculator.
