Plain meaning
A registered account intended to help eligible first-time home buyers save for a qualifying home purchase.
Also called
First Home Savings Accounts
Background
The FHSA became available in 2023 after being announced as part of federal housing-affordability measures.
Key points
- Eligible individuals can generally contribute up to $8,000 per year, subject to a $40,000 lifetime contribution limit.
- Contributions may be deductible, similar to RRSP contributions.
- Qualifying withdrawals for a first home purchase are generally not taxable.
- Unused annual participation room can be carried forward, subject to program limits.
- If funds are not used for a qualifying home purchase, transfer and withdrawal rules determine the tax result.
Why it comes up
FHSA rules connect personal savings, housing affordability, and tax-assisted home ownership.