FHSA and RRSP Home Buyers' Plan: How Ontario First-Time Buyers Can Combine Them

For first-time buyers in York Region, the down payment is usually the hardest part of buying. Two federal programs can help: the First Home Savings Account (FHSA) and the RRSP Home Buyers' Plan (HBP). They are often explained separately, and they sit alongside the other one-time costs in our closing costs guide, but many buyers can use both on the same purchase, and a couple can each use their own. This guide explains how they fit together, using rules published by the Canada Revenue Agency, and how they sit alongside Ontario's land transfer tax refund, which we covered in our first-time buyer land transfer tax guide.

The FHSA in brief

An FHSA is a registered account for first-time home buyers. Eligible individuals can contribute up to $8,000 a year, with a lifetime limit of $40,000. Contributions are generally tax-deductible, and qualifying withdrawals to buy a first home are tax-free (Canada Revenue Agency, accessed October 2026). Unused annual room can carry forward, within limits, so opening an account early can help even if you cannot contribute the full amount right away. The CRA sets conditions for a qualifying withdrawal, including that you are a first-time home buyer, that you have a written agreement to buy or build a qualifying home in Canada, and that you intend to live in it as your principal residence. Check the CRA's current rules before you withdraw.

The RRSP Home Buyers' Plan in brief

The HBP lets eligible first-time buyers withdraw up to $60,000 from their RRSPs to buy or build a qualifying home. Unlike the FHSA, the HBP is a loan to yourself: you must repay the amount to your RRSP over a 15-year period, or the required annual repayment is added to your income (Canada Revenue Agency, accessed October 2026). The CRA's rules also address timing, such as how long funds must be in the RRSP before withdrawal and when the home must be bought.

Using both on the same home

The CRA confirms you can use an FHSA and the HBP for the same qualifying home, and that each eligible buyer can use their own FHSA and HBP amounts (Canada Revenue Agency, accessed October 2026). For a couple who are both first-time buyers, that means two FHSAs and two HBP withdrawals could be available, subject to each person's own savings and eligibility.

A York Region example

Consider a couple buying a $900,000 townhouse in Richmond Hill. Under federal rules, the minimum down payment for an insured mortgage is 5% of the first $500,000 and 10% of the portion above that, up to $1.5 million (Financial Consumer Agency of Canada, accessed October 2026). That works out to $25,000 plus $40,000, or $65,000. If each partner has $20,000 in an FHSA and $15,000 available in an RRSP, they could potentially fund $70,000 from these accounts, covering the minimum down payment with some left toward closing costs. This is an illustration only; your lender will confirm the down payment and qualifying rules for your situation, and mortgage default insurance premiums apply to insured mortgages.

Which to use first?

Because FHSA withdrawals do not need to be repaid and HBP withdrawals do, many buyers prioritize the FHSA. But the right order depends on your income, your existing RRSP savings, and whether you expect to be able to make HBP repayments comfortably. Someone in a high tax bracket today who expects lower income during a parental leave may plan differently from someone early in their career. This is a good conversation to have with an accountant or financial planner.

Timing traps to avoid

• Opening too late: FHSA room starts accumulating only once you open an account.
• Withdrawing too early: a qualifying FHSA withdrawal generally requires a written agreement to buy or build. Withdrawals made before conditions are met may be taxable.
• Last-minute RRSP contributions: the HBP has rules on contributions made shortly before withdrawal; check them before you top up your RRSP.
• Bank processing time: financial institutions need time to process withdrawals. Do not leave it to the week of closing.
• Proof for your lender: lenders usually want to see account statements showing the funds.

How this fits with Ontario's land transfer tax refund

The FHSA and HBP help with the down payment. Ontario's first-time buyer land transfer tax refund reduces a closing cost. Eligibility rules for each are different: the federal programs have their own definition of a first-time buyer, and the Ontario refund has its own. You may qualify for one and not another, so check each separately.

A simple planning checklist

1. Confirm you meet the CRA definition of a first-time home buyer for both the FHSA and the HBP.
2. Open an FHSA as early as possible, even with a small deposit, so annual room starts building.
3. Decide how much to contribute each year, based on your budget and tax situation.
4. Check your RRSP balance and how long contributions have been in the plan.
5. Get a mortgage pre-approval that reflects the down payment you plan to use.
6. Once you have a firm agreement of purchase and sale, request the FHSA and HBP withdrawals from your financial institutions with enough time before closing.
7. Keep records of withdrawals and the forms you submitted for your next tax return.
8. Plan your HBP repayments in your budget for future years.

Rules for registered accounts change from time to time, so confirm the current limits and conditions on the CRA website or with your financial institution before you act. Used thoughtfully, these programs can shorten the time it takes to save for a home in York Region, but they work best as part of a wider plan that also considers closing costs, emergency savings and your monthly budget after you move in.

Finally, keep in mind that savings in these accounts can be invested, and investment values can go down as well as up. As your purchase date gets closer, many buyers choose lower-risk options.

Frequently asked questions

How much can I put in an FHSA?

Up to $8,000 a year, with a lifetime limit of $40,000, according to the Canada Revenue Agency.

How much can I withdraw under the RRSP Home Buyers' Plan?

Up to $60,000 per eligible person, which must be repaid to your RRSP over 15 years.

Can I use the FHSA and the Home Buyers' Plan together?

Yes. The CRA confirms both can be used for the same qualifying home, and each eligible buyer can use their own.

What is the minimum down payment on a $900,000 home?

For an insured mortgage, 5% of the first $500,000 plus 10% of the remaining $400,000, or $65,000, under federal rules published by the Financial Consumer Agency of Canada.

General information only, not legal, tax or financial advice. Figures were checked against the sources linked above in October 2026 and can change; confirm your own numbers with your real estate lawyer, accountant or lender before you sign anything.

Farshad Fazaeli, Salesperson, International Realty Firm, Inc., Brokerage, 647-667-5555 · Richmond Hill, ON