Is FHSA better than the Home Buyers' Plan?

For most new savers, yes — FHSA offers tax-deductible contributions and tax-free qualifying withdrawals with no repayment. HBP is better as a supplement when you already have RRSP savings and need more than the $40,000 FHSA lifetime limit.

Can I use FHSA and HBP in the same year?

Yes. You can make a qualifying FHSA withdrawal and an HBP withdrawal for the same home purchase, subject to each program's rules and limits.

Should I transfer RRSP money into an FHSA?

You can transfer from an RRSP to an FHSA subject to FHSA contribution limits, but transfers do not create a new tax deduction. Get tax advice before moving funds — especially if you also plan an HBP withdrawal.

What if I only have enough for one account?

Open and fund the FHSA first to start contribution room and capture the double tax advantage. Add HBP later once you have RRSP savings or need more than $40,000 for the down payment.

FHSA vs Home Buyers' Plan (HBP) Canada 2026

Updated for 2026 · Free, unbiased education for Canadian first-time home buyers

Quick Answer

Should I use an FHSA or the Home Buyers' Plan first?

Most first-time buyers should prioritize the FHSA first because contributions are tax-deductible and qualifying withdrawals are tax-free with no repayment. Use the RRSP Home Buyers' Plan next for additional down-payment funds — up to $60,000 per person that must be repaid over 15 years. Using both together unlocks up to $100,000 per person.

FHSA: $8,000/year, $40,000 lifetime, no repayment on qualifying withdrawals
HBP: $60,000 RRSP withdrawal per person, 15-year repayment required
Best default: max FHSA first, then HBP for the rest of your down payment
Together: up to $100,000 per person / $200,000 per couple

Source: Canada Revenue Agency

Quick comparison: FHSA vs HBP

The FHSA is a dedicated first-home savings account with a double tax advantage and no repayment. The HBP is a temporary tax-free loan from your existing RRSP that you must repay. FHSA room only starts once you open the account; HBP requires RRSP savings already in place. They solve different problems and work best together.

When FHSA wins

Choose FHSA first if you are still saving, want an immediate tax deduction, and do not want a 15-year repayment obligation. Opening early also starts your annual contribution room and the 15-year account clock. Unused FHSA balances can later transfer to an RRSP tax-free if you never buy.

When HBP wins

Use HBP when you already have substantial RRSP savings and need more than $40,000 for a down payment. HBP does not create new contribution room — it unlocks money you already saved for retirement. It is especially useful for buyers close to purchasing who cannot wait to fill an FHSA over multiple years.

The winning move: use both

CRA allows FHSA and HBP on the same purchase. A practical order: open and fund the FHSA every year, keep contributing to RRSP if your plan allows, then withdraw FHSA tax-free and HBP as needed at purchase. Model both paths in our comparison tools before you move money.

Deep-dive guide chapters

Continue learning in our free 8-module guide — each link goes to a detailed chapter with checklists, examples, and calculators.

FHSA Guide Canada 2026Limits, eligibility, carry-forward, and withdrawals Home Buyers' Plan 2026$60,000 limit, repayment rules, and T1036 form Combined strategy deep diveStep-by-step stacking plan with examples Interactive comparison toolsFHSA vs RRSP/HBP side-by-side calculator TFSA for home buyersWhere TFSA fits beside FHSA and HBP Down payment strategiesTurn registered savings into a qualifying down payment

Frequently asked questions

Related resources from LendCity

FirstHomeGuide.ca is part of the LendCity education network. When you are ready for personalized mortgage guidance — or planning beyond your first purchase — these trusted resources can help.

LendCity MortgagesLicensed mortgage professionals across Canada — pre-approval, rate shopping, and first-time buyer financing with no obligation.Mortgage Renewal HubFree renewal education for when your first mortgage term ends — compare rates, avoid lender auto-renewals, and plan your next term.

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