Buying Your First Home in BC? How to Use Your FHSA and RRSP Home Buyers’ Plan Together.
Buying your first home in British Columbia is exciting… but let’s be honest, saving for a down payment can feel like a full-time job.
Between rising home prices, closing costs, and trying to save while still enjoying your life, getting into the market can seem overwhelming.
The good news? If you’re a first-time home buyer, the Canadian government has two programs that can help you get there: the First Home Savings Account (FHSA) and the RRSP Home Buyers’ Plan (HBP).
Even better, you can use both programs to buy the same home.
That means you could potentially save money on your taxes, build your down payment faster, and access more of your own savings when it’s time to buy.
Let’s break down how it all works, what you need to know before withdrawing your money, and a few common mistakes you’ll want to avoid.
This guide is current as of October 2026 and focuses on Canadian federal tax rules, with a few BC-specific considerations.
1. First things first: What’s the difference between an FHSA and an RRSP?
Although both accounts can help you save for a home, they work a little differently.
The FHSA: Your first-home savings account
Think of the FHSA as a special savings and investment account designed specifically for buying your first home.
Here’s why it’s so useful:
You can contribute up to $8,000 per year, subject to your available contribution room.
Your lifetime contribution limit is $40,000.
Contributions are generally tax-deductible, which can reduce your taxable income.
When you make a qualifying withdrawal to buy your first home, you don’t pay tax on the withdrawal.
You can only carry forward up to $8,000 of unused contribution room. You can't keep adding another $8,000 every year that you don't contribute.
Unlike the RRSP Home Buyers’ Plan, you don’t have to pay the money back.
That last point is a big one!
You get a tax deduction when you contribute, and you can withdraw your qualifying savings tax-free to buy your home. There’s no repayment schedule hanging over your head afterward.
You can also invest the money inside your FHSA, depending on the account and investments you choose. Just remember that investments can go down as well as up, so consider your home-buying timeline before taking on risk.
The RRSP Home Buyers’ Plan: Accessing your retirement savings
An RRSP, or Registered Retirement Savings Plan, is primarily designed to help you save for retirement.
However, the Home Buyers’ Plan lets you withdraw money from eligible RRSPs to buy or build a qualifying home without having to include that withdrawal in your taxable income, provided you follow the program’s rules.
Under the current rules:
You can withdraw up to $60,000 per eligible individual through the HBP.
If you’re buying with a partner and you both qualify, you could potentially withdraw up to $120,000 combined.
You generally have to repay the amount withdrawn over 15 years.
Repayments are not tax-deductible, because you’re paying back money you previously withdrew.
If you don’t make the required repayment for a year, the shortfall is generally added to your taxable income for that year.
The important distinction? The FHSA is designed to provide tax-free savings for your first home, while the HBP gives you temporary access to money in your RRSP that you’ll generally need to replenish over time.
For the official rules, see the CRA’s Home Buyers’ Plan guide.
2. Can you use your FHSA and RRSP together?
Yes! And for many first-time buyers, this is where things get interesting.
You can make a qualifying withdrawal from your FHSA and an HBP withdrawal from your RRSP for the same home, as long as you meet the eligibility requirements for both programs.
Let’s look at a simple example.
Imagine you’re buying a home in the Okanagan or the Lower Mainland and have built up the following savings:
Account | Amount available |
FHSA | $32,000 |
RRSP available for the HBP | $40,000 |
Total available for your down payment | $72,000 |
You could potentially use the full $72,000 toward your purchase, assuming you meet all the applicable conditions.
The $32,000 FHSA withdrawal could be tax-free and would not need to be repaid. The $40,000 HBP withdrawal would generally be tax-free at the time of withdrawal, but you’d need to repay it according to the HBP rules.
If you’re purchasing with a partner who has their own eligible accounts, your combined savings could be even higher.
Of course, this doesn’t mean you should automatically empty every account you have. You’ll still need money for legal fees, property transfer tax if applicable, moving expenses, and those inevitable first-home purchases.
The goal is to use the programs strategically, not leave yourself with a beautiful new house and $14 in your chequing account.
3. The RRSP Home Buyers’ Plan: The rules you really need to know
This is the section worth paying attention to, because the HBP has some specific rules that can catch people off guard.
How much can you withdraw?
The current maximum is $60,000 per eligible individual.
This is a limit on the amount you can withdraw under the HBP, not a limit on the total size of your RRSP.
For example:
You have $25,000 in your RRSP: you may be able to withdraw up to $25,000.
You have $75,000 in your RRSP: the HBP limit generally allows you to withdraw up to $60,000.
You have $120,000 in your RRSP: the HBP limit is still $60,000.
You cannot withdraw $60,000 from every RRSP you own. The limit applies to the total HBP withdrawals for you.
If two eligible buyers are purchasing together, each person has their own limit.
Do you have to be a first-time home buyer?
Generally, yes, although the CRA has a specific definition of a first-time home buyer.
You generally must not have lived in a home that you owned, or that your current spouse or common-law partner owned, as your principal place of residence during the current calendar year before the withdrawal and the preceding four calendar years.
There are exceptions and additional rules, including provisions for certain people buying a home for a specified disabled person.
This means the definition is not always as simple as whether you have ever owned a property.
For example, someone who owned a home years ago but has not lived in an owned home during the relevant period may qualify again, provided they meet all the other conditions.
If you’re buying with a spouse or common-law partner, check your circumstances carefully before assuming you qualify.
You need a written agreement to buy or build a home.
You generally need a written agreement to buy or build a qualifying home in Canada.
You also need to intend to occupy the home as your principal place of residence within one year after buying or building it.
The HBP is not intended to be a way to withdraw RRSP money for an investment property that you plan to rent out without living in it.
Which RRSP accounts qualify?
Generally, you can use money held in an eligible RRSP with a financial institution, provided the account and withdrawal meet the program rules.
However, some employer-sponsored arrangements or locked-in retirement accounts may have restrictions or may not qualify for an HBP withdrawal.
If you have a group RRSP through work, check with your plan administrator before counting that money toward your down payment.
Do you need to have the RRSP for a certain amount of time?
There is no general rule saying you must have owned your RRSP account for a specific number of years.
However, there is a very important rule about recent RRSP contributions, which we’ll cover next.
That rule can affect whether you can deduct contributions you made shortly before withdrawing the money under the HBP.
4. The 90-day RRSP rule: What contributions count, and what doesn't?
This is probably the most important technical detail in the entire article.
You may have heard that you need to leave your RRSP contributions in your account for 90 days before withdrawing them under the Home Buyers’ Plan.
That’s a useful rule of thumb, but the actual CRA calculation is a little more specific.
The CRA looks at contributions made during the 89-day period immediately before an HBP withdrawal.
If you contribute to your RRSP shortly before making an HBP withdrawal, you may not be able to deduct all those contributions on your tax return.
And yes, this can happen even if your contribution was perfectly legitimate and you had enough RRSP contribution room.
How does the rule actually work?
The CRA compares:
Your eligible RRSP contributions made during the 89 days before the withdrawal.
The fair market value of the property remaining in that RRSP immediately after the withdrawal.
If the recent contributions exceed the value remaining in the RRSP, the excess is not deductible for any year.
Let’s make that easier to understand.
Example 1: You contribute $10,000 and withdraw $10,000
Suppose you already have $10,000 in your RRSP and contribute another $10,000 shortly before using the HBP.
Your account now contains $20,000.
You withdraw the full $20,000 under the HBP, leaving $0 in the account.
The recent contribution was $10,000, but the account is worth $0 after the withdrawal.
Under the 89-day rule, the $10,000 recent contribution would not be deductible.
That means you don't get the RRSP tax deduction you may have been expecting for that contribution.
Example 2: You contribute $10,000 and leave $10,000 in the account
Now suppose you have $10,000 in your RRSP, contribute another $10,000, and withdraw only $10,000 under the HBP.
You have $10,000 remaining in the RRSP after the withdrawal.
Your recent contribution was $10,000, and the account's remaining value is also $10,000.
In this simplified example, the 89-day rule would not prevent you from deducting that $10,000 contribution, assuming you have the necessary RRSP deduction room and meet the other requirements.
Example 3: You contribute $15,000 and withdraw everything
Suppose you contribute $15,000 to an RRSP during the 89-day period and withdraw the entire balance under the HBP, leaving $0.
The recent contribution is $15,000, and the account is worth $0 after the withdrawal.
The $15,000 recent contribution would not be deductible under this rule.
The key takeaway is that contributing money to an RRSP and immediately withdrawing it under the HBP doesn't automatically give you an RRSP tax deduction.
The timing and the value left in the account matter.
What if I contributed to another RRSP?
This is another important detail.
The CRA's calculation can include eligible contributions transferred from one RRSP to another during the 89-day period.
Moving money between your RRSP accounts doesn't necessarily make the recent-contribution issue disappear.
There are also specific exclusions for certain amounts, so the calculation should be based on the CRA's rules rather than simply adding up every deposit you see on a statement.
What if I contributed to my partner's RRSP?
If you contributed to your spouse's or common-law partner's RRSP and they are making an HBP withdrawal from that account, similar 89-day rules can apply.
This is particularly important if you have been using spousal RRSP contributions as part of your household's savings strategy.
Can I still withdraw the money if I can't deduct the contribution?
Potentially, yes.
The 89-day rule is primarily about whether certain recent contributions are deductible. It does not automatically mean the withdrawal itself is prohibited.
You still need to meet all the HBP withdrawal conditions, including the applicable contribution, account, and purchase requirements.
My practical advice on the 90-day rule
If you're planning to buy soon and want to top up your RRSP before using the HBP, don't leave this until the last minute.
Speak with your financial advisor before making a large contribution, and review the CRA's official explanation here:
It's much better to understand the tax implications before moving the money than to discover them when you're filing your return.
5. What counts as an RRSP contribution — and what doesn't?
When you're planning an HBP withdrawal, it's important to understand the difference between contributing money, transferring money, and repaying an earlier HBP withdrawal. They aren't all treated the same way.
Generally, RRSP contributions include:
Money you contribute directly to your own RRSP.
Eligible contributions you make to your spouse's or common-law partner's RRSP.
Eligible contributions to certain other registered retirement savings arrangements covered by the CRA rules.
You need to have sufficient RRSP deduction room to claim a deduction, and the HBP's 89-day rule may affect the deductibility of recent contributions.
These transactions don't automatically give you a new RRSP deduction:
Direct transfers between registered accounts: A qualifying direct transfer generally isn't treated like a new deductible contribution.
HBP repayments: Money designated as repayment of your HBP balance isn't deductible again.
Investment growth inside your RRSP: Interest, dividends, and capital gains earned inside the account aren't personal RRSP contributions.
Administration and brokerage fees: These aren't deductible RRSP contributions.
Money borrowed to contribute: The borrowed principal you deposit may be an RRSP contribution if the other conditions are met, but the interest on the loan isn't deductible as an RRSP contribution.
There are specific rules for different types of transfers, so don't assume that every amount entering an RRSP creates a new deduction.
For a full breakdown, see the CRA's RRSP contribution and deduction rules.
6. How do you actually withdraw the money under the HBP?
Once you're eligible and ready to proceed, the withdrawal process is relatively straightforward.
Confirm your eligibility. Make sure you meet the HBP requirements and have a qualifying home purchase or construction arrangement.
Review your RRSP contributions. Pay particular attention to contributions made in the 89 days before your planned withdrawal.
Complete Form T1036. This is the CRA's Home Buyers' Plan Request to Withdraw Funds from an RRSP.
Submit the form to your RRSP issuer. Your bank or investment provider will complete its portion and process an eligible withdrawal.
Keep your paperwork. You'll need the withdrawal details when completing your tax return and tracking your repayment obligations.
You may be able to make multiple HBP withdrawals, but they must fall within the permitted withdrawal period. Generally, you can make withdrawals in the calendar year of your first withdrawal and in January of the following year.
Don't leave the paperwork until the day you need to send your down payment. Processing times vary, so coordinate with your lender, lawyer, and financial institution well in advance.
7. The RRSP repayment rules: When do you have to pay it back?
Unlike the FHSA, the Home Buyers' Plan isn't free money. It's money you're allowed to borrow from your own retirement savings, with the expectation that you'll pay it back over time.
The good news is that the repayment schedule is spread over many years.
How long do you have to repay it?
Under the standard HBP rules, you generally have 15 years to repay your withdrawal.
However, there's an important temporary rule for people making their first HBP withdrawal between
January 1, 2022, and December 31, 2025, as well as an extension for first withdrawals made between January 1, 2026, and December 31, 2028.
For those qualifying first withdrawals, the repayment period starts in the fifth year following the year of the first withdrawal, rather than the second year.
For example, if you make your first HBP withdrawal in 2026, your first required repayment year will be 2031.
That gives you some breathing room while you settle into homeownership.
How much do you have to repay each year?
Let's say you withdraw $30,000 from your RRSP under the HBP.
If you have a 15-year repayment period, your minimum annual repayment would generally be:
$30,000 ÷ 15 = $2,000 per year.
You would need to designate $2,000 each year as an HBP repayment to keep up with the schedule.
Your own repayment amount depends on your withdrawal balance and repayment schedule. The CRA provides your HBP balance and minimum repayment information through your tax records and account.
Do HBP repayments give you another tax deduction?
No - This is a common misunderstanding.
When you repay your HBP, you're returning money to your RRSP, but you cannot claim a tax deduction for that repayment.
That's because the money was originally withdrawn under a special program rather than taxed as income.
You can generally contribute more than your required repayment, but only the amount you designate as an HBP repayment counts toward the repayment schedule.
What happens if you don't make the required repayment?
If you don't repay the required amount for a particular year, the shortfall is generally included in your taxable income for that year.
For example, if your minimum repayment is $2,000 and you make no repayment, that $2,000 is generally added to your income for tax purposes.
You'll still need to follow the remaining repayment schedule for your outstanding HBP balance.
This is why it's important to remember that the HBP affects your future budget, even if it helps you buy your home today.
For more details, visit the CRA's Home Buyers' Plan repayment rules.
8. FHSA withdrawals: The rules are simpler, but there are still a few things to know
We've covered the more complicated side of the RRSP. Now let's look at the FHSA.
The FHSA is often the preferred first stop for first-time buyers because qualifying withdrawals don't have to be repaid.
However, you still need to follow the program requirements.
You must make a qualifying withdrawal
To withdraw money tax-free for your home, you generally need to:
Meet the CRA's first-time home buyer requirements at the time of the withdrawal.
Have a written agreement to buy or build a qualifying home in Canada.
Intend to occupy the home as your principal place of residence within one year of buying or building it.
Complete Form RC725, Request to Make a Qualifying Withdrawal from your FHSA.
Meet the applicable timing requirements for the purchase or construction.
Generally, the agreement must specify that the acquisition or construction completion date will be before October 1 of the year following the withdrawal.
You also generally need to be a resident of Canada from the time you make the withdrawal until you acquire the qualifying home.
Check the current CRA requirements before requesting the funds, particularly if your purchase is delayed or your circumstances change.
Is there a limit on how much you can withdraw?
There is no separate dollar limit on a qualifying FHSA withdrawal like the $60,000 HBP limit.
You can generally withdraw the available FHSA funds for a qualifying purchase, provided the withdrawal meets the program rules.
For example, if your FHSA contains $35,000, you may be able to withdraw that full amount tax-free for your qualifying home purchase.
Remember that your lifetime FHSA contribution limit is $40,000, but investment growth can increase the amount available in the account.
What happens if you don't end up buying?
If you don't buy a qualifying home, you generally can't simply take the money out for personal spending and expect the withdrawal to be tax-free.
A taxable FHSA withdrawal is generally included in your income.
However, you can generally transfer your FHSA funds directly to your RRSP or RRIF on a tax-deferred basis, subject to the applicable rules and without using RRSP deduction room.
You generally have until December 31 of the year in which the 15th anniversary of opening your first FHSA occurs to use or transfer the account, subject to earlier deadlines in certain circumstances.
That means opening an FHSA early can be valuable, but it's worth keeping the account's time limits in mind.
9. How much could you save using both programs?
Let's put everything together with a hypothetical couple buying their first home in BC.
Imagine each buyer has saved the following amounts:
Savings account | Buyer 1 | Buyer 2 |
FHSA | $25,000 | $20,000 |
RRSP available for HBP | $30,000 | $40,000 |
Total | $55,000 | $60,000 |
Together, they could potentially access $115,000 for their purchase.
That breaks down to:
$45,000 from their FHSAs, withdrawn tax-free if both meet the qualifying withdrawal requirements.
$70,000 from their RRSPs under the HBP, subject to the withdrawal rules and future repayment obligations.
This can make a significant difference to a down payment.
Just remember that using your savings for a down payment is only part of the picture. You'll also need to qualify for a mortgage and have enough money available for closing costs and other expenses.
10. A few BC-specific things to remember
Buying a home in British Columbia comes with a few additional considerations.
Property Transfer Tax
BC has a Property Transfer Tax that may apply when you purchase real estate.
There are exemptions and eligibility requirements for certain first-time buyers, and the rules can depend on the property's fair market value, your circumstances, and other factors.
Don't automatically assume you qualify for an exemption just because you're using the FHSA or HBP. These are separate programs with separate requirements.
You can check the province's official Property Transfer Tax information.
Budget for closing costs
Even if you have enough for your down payment, you should set aside additional funds for expenses such as:
Legal or notary fees.
Home inspection costs.
Appraisal fees, if applicable.
Property Transfer Tax, if applicable.
Moving expenses.
Home insurance and utility setup.
Immediate repairs, furniture, or other essentials.
These costs can add up quickly, so try not to put every available dollar into your down payment.
Your mortgage qualification still matters
Having a larger down payment can help, but lenders will also assess your income, debts, credit history, and ability to make mortgage payments.
Your lender may also need documentation showing where your down payment funds came from.
Let your mortgage professional know early if you're planning to use an FHSA and the HBP together. That way, everyone can coordinate the timing and paperwork.
11. Common mistakes to avoid
Before you get too excited about using these programs, here are a few things to keep in mind.
Don't forget about the 89-day RRSP rule. Recent contributions may not be deductible if the account value after the withdrawal is too low.
Don't assume all RRSPs are eligible. Check any employer-sponsored or locked-in arrangements with your plan administrator.
Don't forget that HBP withdrawals must be repaid. Budget for the future repayment schedule.
Don't confuse an HBP repayment with a new deductible contribution. Repayments aren't deductible.
Don't withdraw FHSA money before checking the qualifying withdrawal conditions. An ineligible withdrawal may be taxable.
Don't use all your cash for the down payment. Keep a reserve for closing costs and emergencies.
Don't assume you qualify just because you're buying your first home. The CRA has specific eligibility definitions, and the FHSA and HBP have their own requirements.
12. So, which should you use first?
There isn't one perfect strategy for everyone, but a common approach is to prioritize the FHSA when you're eligible because qualifying withdrawals are tax-free and don't need to be repaid.
If you also have money in an RRSP, the HBP can be a useful way to increase your available down payment.
Before making large contributions or withdrawals, look at your income, available RRSP deduction room, purchase timeline, and the amount you expect to need for closing.
If you have a short timeline, be particularly careful about making new RRSP contributions just before an HBP withdrawal.
And if you're buying with a partner, remember that each person's eligibility, accounts, contribution history, and repayment obligations need to be considered individually.
The bottom line —
Buying your first home in BC is a big milestone, and you don't have to figure out every part of the process on your own.
The FHSA and RRSP Home Buyers' Plan can work together to help you build a stronger down payment, reduce your taxes where eligible, and make homeownership a little more attainable.
The FHSA offers tax-deductible contributions and tax-free qualifying withdrawals without repayment. The HBP lets you access eligible RRSP savings, but you'll generally need to repay what you withdraw over time.
The most important thing is to understand the rules before moving your money — especially the RRSP 89-day contribution rule, HBP repayment requirements, and FHSA withdrawal conditions.
A little planning now can save you a lot of stress later.
Disclaimer: This article is for general educational purposes only and isn't personalized financial, tax, legal, or mortgage advice. Federal program rules can change, and individual circumstances matter. Confirm your eligibility and tax treatment with the CRA or a qualified professional before making decisions.
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