Our plan provider Canada Life has gathered all the key points about the new First Home Savings Account (FHSA) in a short article. Here is a summary of everything you need to know:

  • This new savings account will be launched in 2023
  • It combines some of the features of an RRSP and a TFSA to help Canadians to save for the purchase of their first home
  • Contributions to the account will reduce the taxable income of the contributor
  • Annual contribution limit is $8000 to a lifetime limit of $40,000
  • Withdrawals that are made towards the purchase of a first home will be tax-free
  • If the funds haven’t been used towards a home within 15 years, the amount must be transferred to an RRSP or a RRIF, tax-free and without any impact to your RRSP contribution limit for that year
  • To be eligible, you must be a Canadian citizen; 18 years and older; you can’t own a home within the year that you open the account or the four years following; funds must be used for a primary home
  • You can open more than one FHSA but you can’t exceed your annual limit of $8000
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