Annual limit: $8,000.00 · Lifetime limit: $40,000.00
An FHSA can stay open for a maximum of 15 years.
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First-Year Tax Refund
$2,372.00
Your $8,000.00 contribution deducted at your 29.6% marginal rate
Total Tax Refunds
$11,860.00
Projected Balance (Tax-Free)
$46,415.30
Withdrawn tax-free for a qualifying first-home purchase
Marginal Rate
29.6%
Effective Cost
$28,140.00
You reach the $40,000.00 lifetime limit in year 5. After that, the balance keeps growing tax-free but no new contributions are allowed.
| Year | Room | Contribution | Tax Refund | Balance |
|---|---|---|---|---|
| 1 | $8,000.00 | $8,000.00 | $2,372.00 | $8,400.00 |
| 2 | $8,000.00 | $8,000.00 | $2,372.00 | $17,220.00 |
| 3 | $8,000.00 | $8,000.00 | $2,372.00 | $26,481.00 |
| 4 | $8,000.00 | $8,000.00 | $2,372.00 | $36,205.05 |
| 5 | $8,000.00 | $8,000.00 | $2,372.00 | $46,415.30 |
Assumes 5% annual return compounded yearly. Unused room carries forward (max $8,000.00). Actual returns will vary. Past performance does not guarantee future results.
How much can I put in an FHSA each year?
You can contribute up to $8,000 a year, and up to $40,000 over your lifetime. If you do not use all your room in a year, up to $8,000 carries forward to the next year. So the most you can put in during one year is $16,000. Room only starts once you open the account, so it pays to open one early even with a small amount.
How does the FHSA tax deduction work?
FHSA contributions lower your taxable income, just like RRSP contributions. If you earn $85,000 in Ontario, your marginal rate is about 29.65% — so an $8,000 contribution saves you around $2,372 in tax. You can also save the deduction and claim it in a later year when your income is higher. Note that money transferred in from an RRSP uses up FHSA room but does not give you a deduction.
Who can open an FHSA?
You must be a Canadian resident, aged 18 (or the age of majority in your province) to 71, and a first-time home buyer. First-time means you did not live in a home that you, your spouse, or common-law partner owned in the current year or any of the previous four calendar years.
What happens when I buy my first home?
You make a qualifying withdrawal, and the entire balance — contributions plus all investment growth — comes out completely tax-free. Unlike the RRSP Home Buyers' Plan, there is nothing to repay. You need a written agreement to buy or build a qualifying home in Canada and must plan to live in it within a year of buying.
What if I never buy a home?
The FHSA can stay open for up to 15 years, or until December 31 of the year you turn 71, whichever comes first. If you have not bought a home by then, you can transfer the full balance to your RRSP or RRIF tax-free — and it does not use up any RRSP contribution room. If you take the money as cash instead, it is taxed as income.
Can I use the FHSA and the Home Buyers' Plan together?
Yes. You can combine a tax-free FHSA withdrawal (up to $40,000 of contributions plus growth) with a Home Buyers' Plan withdrawal of up to $60,000 from your RRSP on the same home purchase. The HBP amount must be repaid over 15 years; the FHSA amount never has to be repaid. A couple can each use both accounts.
CRA-Aligned: FHSA limits and tax savings based on 2026 CRA rules. Growth projections are illustrative only. Consult a financial adviser for personalised advice.
How the First Home Savings Account helps you save for your first home
What is an FHSA?
The First Home Savings Account (FHSA) is a registered account for saving towards your first home. It mixes the best parts of an RRSP and a TFSA. Contributions cut your taxable income, like an RRSP. When you buy a qualifying first home, you withdraw everything — including all the growth — completely tax-free, like a TFSA. It launched in 2023 and is the most tax-efficient way to save a deposit in Canada.
Who can open one?
You must be a Canadian resident, at least 18 (or the age of majority in your province) and no older than 71. You must also be a first-time buyer. That means you did not live in a home that you or your spouse or common-law partner owned in the current year or any of the previous four calendar years.
How much can you put in?
You can contribute up to $8,000 each year, with a lifetime cap of $40,000. If you do not use all of your room in a year, up to $8,000 of it carries forward to the next year. So the most you can ever contribute in a single year is $16,000. Room only starts building once you open the account — so opening early matters, even with a small deposit.
How does the tax deduction work?
FHSA contributions reduce your taxable income, just like RRSP contributions. If your marginal tax rate is 30% and you contribute $8,000, you save about $2,400 in tax. You do not have to claim the deduction straight away — you can hold it back and use it in a future year when your income (and tax rate) is higher. One catch: money moved across from an RRSP uses up FHSA room but does not give a deduction.
What happens when you buy a home?
You make a qualifying withdrawal: you must be a first-time buyer with a written agreement to buy or build a home in Canada, and plan to live in it within a year. The whole withdrawal — contributions and growth — is tax-free, and unlike the RRSP Home Buyers' Plan there is nothing to repay. You can also use the FHSA and the Home Buyers' Plan together on the same purchase.
What if you never buy a home?
The account can stay open for up to 15 years, or until the end of the year you turn 71 (whichever comes first). If you have not bought by then, you can move the full balance into your RRSP or RRIF tax-free — and it does not use up any RRSP room. Or you can withdraw the money as cash, in which case it is taxed as income.
FHSA, RRSP or TFSA — which comes first?
If you are saving for a first home, the FHSA usually wins: it gives you the RRSP's tax deduction and the TFSA's tax-free withdrawal in one account. Many people contribute to the FHSA first, then put the tax refund into a TFSA or RRSP. If home ownership is not the goal, a TFSA or RRSP is likely the better fit.
CRA-Aligned: Based on 2026 CRA rules for the First Home Savings Account. Growth projections are illustrative only. For personal advice, speak to a qualified accountant or financial adviser.
Disclaimer: This calculator provides estimates based on current CRA rates and thresholds for the 2026 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant before making financial decisions. Read our terms
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