First Home Savings Accounts in Ontario
A First Home Savings Account, or FHSA, helps eligible first-time home buyers save for a home with tax advantages today and tax-free qualifying withdrawals later. Your FHSA can hold different options depending on your goals, including savings, GICs, mutual funds, bonds, and money market funds.
Save for your first home- Get a tax benefit when you contribute
- Withdraw your money tax-free when you buy
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Unlimited FSRA coverage on registered accounts
What is an FHSA?
An FHSA is a registered account for eligible first-time home buyers. It is designed to help you save or invest for a qualifying home purchase. The account has rules around who can open one, how much you can contribute, how long it can stay open, and what counts as a qualifying withdrawal.1
Savings
Learn more about SavingsHold cash savings inside your FHSA for money you may need sooner for a down payment or home-buying costs. A savings option can help keep first-home money steady while it earns interest.2
GICs
Learn more about GICsHold a GIC inside your FHSA to lock in a guaranteed rate while saving for your first home. Choose a term that matches your home-buying timeline, especially if you know when you may need the money.3
Investments
Learn more about InvestmentsHold eligible FHSA investments like mutual funds, bonds, stocks, or ETFs, depending on the provider and account type. A better fit for longer timelines where your savings have time to ride out market changes.4
Smart FHSA habits help build your down payment faster
An FHSA works best when it has a plan behind it. A few small habits can help you use the account to its full benefit while you save for your first home.
AutomateSet up automatic contributions
Set up automatic contributions
Regular deposits can make saving for your down payment easier by turning it into a consistent habit. Set up automatic weekly, bi-weekly or monthly contributions that fit your budget, helping you steadily build your FHSA savings without having to make one large contribution at once.
AlignMatch investments to your timelines
Match the investment to your timeline
Money you’ll need in a year may need a different approach than money you’re saving for five years from now. Choose FHSA investments with your timeline in mind, balancing the potential for growth with how soon you’ll need the money.
AdviceKnow your contribution limits
Be aware of your contribution room
Your FHSA contribution room is personal to you and determines how much you can contribute. Check your available room before making a larger deposit, keeping in mind that both annual and lifetime contribution limits apply.
How FHSA contribution room works
Your FHSA contribution room is based on when you opened your First Home Savings Account, how much you have contributed or transferred in, any unused room you can carry forward, and the lifetime FHSA limit. Eligible FHSA holders can generally contribute up to $8,000 per year, with a $40,000 lifetime limit. Check your available FHSA room before adding money, because going over your limit can create an excess FHSA amount and may lead to tax penalties. You can find your FHSA limits in your CRA Account.
What happens if my contributions change?
Commonly asked questions
Yes, if you make a qualifying withdrawal, you can use the money toward your home purchase costs. Many first-time buyers use their savings for more than the down payment, including closing costs, legal fees, moving costs, and other first-home expenses.
You may be able to transfer the money directly to an RRSP, RRIF, or withdraw it as taxable income. The right option depends on your situation and the account rules at the time.
Yes, eligible transfers from an RRSP to an FHSA may be allowed, but they do not create a new tax deduction. The transfer also counts toward your FHSA participation room.
No. Unlike RRSP contributions, FHSA contributions made in the first 60 days of the year cannot be claimed for the previous tax year.
Yes, if each person is eligible and each makes a qualifying withdrawal, both buyers may be able to use their own FHSA toward the same qualifying home purchase.
You may still have account rules to follow after your first qualifying withdrawal, but contributions made after that withdrawal generally cannot be claimed as a tax deduction.
Investment losses inside an FHSA cannot be claimed as a tax deduction. This is why the product you hold inside the account should match your home-buying timeline and comfort with risk.
FHSA eligibility depends on the first-time home buyer rules. In general, you cannot have lived in a home you owned, or jointly owned, during the current year or the previous four calendar years.
Direct FHSA contributions may be deductible on your tax return, up to your available FHSA room. Transfers from an RRSP to an FHSA follow different rules and are not deducted the same way as a regular FHSA contribution.
Yes. You may be able to use your FHSA and make an RRSP withdrawal through the Home Buyers’ Plan for the same qualifying home, as long as you meet the rules for both programs.
How to open an FHSA with YNCU
- 1
Become a member
Open your YNCU membership online if you are new to YNCU.
- 2
Talk to an advisor
We’ll help confirm your eligibility and walk you through your FHSA options.
- 3
Start saving
Open your FHSA and add money or investments to your down payment.
A few FHSA rules you should know before you contribute
Make sure you’re eligible
An FHSA is built for eligible Canadian residents who meet the first-time home buyer rules. Check the requirements before you open or contribute.
Contributions may lower taxable income
Eligible FHSA contributions may be tax-deductible, similar to an RRSP. This can help reduce your taxable income when you file your annual tax return.
Know your contribution room
Eligible FHSA holders can generally contribute up to $8,000 each year, with a $40,000 lifetime limit. Unused room may carry forward, subject to government limits.
Avoid overcontributing to your account
Going over your available FHSA room can lead to tax penalties. Check your contribution room before making a larger deposit or transfer.
Qualifying withdrawals are tax-free
When your withdrawal meets the rules for a qualifying first home, the money can generally come out tax-free to help buy or build your home.
You don't repay qualifying withdrawals
Unlike the Home Buyers’ Plan, a qualifying FHSA withdrawal does not need to be repaid. That's one less thing to pay back after closing day.
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¹ FHSA eligibility, contributions and withdrawals
FHSA eligibility, participation limits and account closure deadlines apply. Eligible contributions are generally tax-deductible; transfers from an RRSP to an FHSA are not deductible and use FHSA participation room. Qualifying withdrawals to purchase or build a qualifying home are tax-free only when all applicable conditions are met. Other withdrawals are generally taxable unless a permitted transfer or other exception applies. Excess contributions or transfers may result in tax penalties.
² Savings and deposit insurance
Savings rates are variable and may change without notice. Access to funds is subject to the account terms and applicable registered-plan rules. Eligible Canadian-dollar deposits held in a TFSA, RESP, LIRA, RRIF or FHSA at YNCU have unlimited deposit insurance coverage through the Financial Services Regulatory Authority of Ontario (FSRA), subject to its rules. Mutual funds, stocks, ETFs and bonds are not covered by this deposit insurance.
³ GIC terms and guarantees
GIC rates, terms, minimum deposits and interest payment options vary by product. Rates may change before purchase or renewal. Fixed-rate guarantees and access to funds are governed by the investment agreement. Non-redeemable GICs generally cannot be cashed before maturity. Early redemption of cashable or redeemable GICs may affect interest payable. Registered-plan withdrawal restrictions also apply.
⁴ Investment risks and availability
Available investments and services vary by provider and account type. Mutual funds, stocks, ETFs and bonds involve risk and may lose value. Returns are not guaranteed, and past performance does not indicate future results. Fees and expenses may apply. Investments must meet the applicable registered-plan requirements. Review the relevant investment and account disclosures before investing.
General information
This page provides general information and does not constitute individualized investment, tax or legal advice. Eligibility requirements, account agreements and applicable tax or pension legislation apply. Tax treatment depends on your circumstances, and rules may change. Speak with a qualified advisor before making a decision.