A First Home Savings Account (FHSA) is a registered account designed to help eligible first-time home buyers save for a qualifying home in Canada.

FHSA contributions are generally tax-deductible, investment income can grow inside the account on a tax-sheltered basis, and a qualifying withdrawal for an eligible home purchase is generally not included in taxable income.

For 2026, the main FHSA limits remain:

• $8,000 of participation room in the year the first FHSA is opened
• up to $8,000 of unused participation room that may be carried forward
• a $40,000 lifetime FHSA limit for contributions and qualifying RRSP-to-FHSA transfers

FHSA participation room does not begin accumulating until the first FHSA is actually opened.

The CRA provides the complete federal rules on its First Home Savings Account page.

FHSA 2026 Limits at a Glance

FHSA Rule	2026 Amount or Rule
Participation room in the year the first FHSA is opened	$8,000
Maximum participation-room carry-forward	Up to $8,000
Lifetime FHSA limit	$40,000
Qualifying withdrawal limit	No fixed withdrawal ceiling; qualifying FHSA property may be withdrawn
Tax on excess FHSA amounts	Generally 1% per month
Maximum participation period	Subject to the 15-year, age-71 and qualifying-withdrawal rules

Who Can Open an FHSA?

To open an FHSA, a person must be a qualifying individual under CRA rules.

At the time the account is opened, the individual must generally:

• be a resident of Canada
• meet the applicable minimum age requirement
• be 71 years of age or younger at the end of that year
• meet the FHSA first-time home buyer definition

The normal minimum age is 18, although a person may need to be 19 in a province or territory where age 19 is required to enter into the contract used to open the account.

The CRA explains the eligibility rules on its FHSA opening and eligibility page.

What Does “First-Time Home Buyer” Mean for Opening an FHSA?

The FHSA definition looks beyond whether a person owns a home on the day the account is opened.

Generally, when opening an FHSA, the individual must not have lived in a qualifying home as their principal place of residence that they owned or jointly owned during:

• the current calendar year, or
• the previous four calendar years.

If the individual has a spouse or common-law partner, additional rules apply regarding a home owned or jointly owned by that spouse or partner that was used as the individual’s principal place of residence.

Someone who previously owned a home may therefore become eligible again after satisfying the applicable lookback period.

FHSA Room Starts Only After the Account Is Opened

FHSA participation room does not accumulate before the first FHSA is opened.

For example, assume someone was otherwise eligible to open an FHSA in 2024 but waited until 2026.

Opening the first FHSA in 2026 would generally create:

$8,000 of FHSA participation room for 2026

It would not automatically create $24,000 of room for 2024, 2025 and 2026.

This differs from TFSA contribution room, which follows separate accumulation rules.

For TFSA limits, see our TFSA Contribution Limit 2026 guide.

How FHSA Carry-Forward Works

Unused FHSA participation room may increase the amount available in a later year.

The participation-room carry-forward is generally limited to $8,000.

For example, suppose an individual opens a first FHSA in 2026 and contributes $3,000 during the year.

The unused amount is:

$8,000 − $3,000 = $5,000

In a straightforward case, the following year’s available room could include:

$8,000 of new room + $5,000 carried forward = $13,000

If the full $8,000 remained unused, available participation room in the following year could potentially reach $16,000, subject to the FHSA calculation rules and lifetime limit.

Contributions, RRSP transfers, excess amounts, designated amounts and certain withdrawals can affect the actual calculation.

The CRA explains the calculation on its FHSA participation room page.

The FHSA Lifetime Limit Is $40,000

The lifetime FHSA limit is generally $40,000 per individual.

Both personal contributions and direct RRSP-to-FHSA transfers can use FHSA participation room and count toward the applicable lifetime limit.

The $40,000 figure limits the amount contributed or transferred into the FHSA under these rules. It does not necessarily limit the eventual market value of the account.

For example, an FHSA containing $40,000 of contributions could later be worth more than $40,000 because of investment growth.

FHSA Contributions Can Be Tax-Deductible

Eligible personal FHSA contributions can generally be deducted from taxable income.

A contribution and the related deduction do not necessarily have to be claimed in the same tax year.

Eligible FHSA contributions that have not previously been deducted can generally be carried forward and claimed in a later year, subject to the CRA deduction rules.

The CRA explains FHSA deductions on its FHSA tax deductions page.

FHSA Contributions Follow the Calendar Year

FHSA contribution timing differs from the RRSP contribution system.

FHSA contributions generally apply to the calendar year in which they are made.

For example, a contribution made in January 2027 is a 2027 FHSA contribution. It cannot normally be treated as a 2026 contribution under the RRSP first-60-days system.

For an FHSA contribution to count as a contribution made in 2026, it generally needs to be made by December 31, 2026.

Opening More Than One FHSA Does Not Create More Room

An individual may be able to hold more than one FHSA, but opening additional accounts does not multiply participation room.

The $8,000 participation-room calculation and the $40,000 lifetime limit apply across all FHSAs belonging to the same individual.

Can Couples Each Have an FHSA?

Yes. If both people independently meet the FHSA eligibility requirements, each can open their own FHSA.

Each individual has their own:

• FHSA participation room
• $40,000 lifetime limit
• deduction history
• qualifying-withdrawal requirements

Two qualifying individuals purchasing the same home can each make a qualifying withdrawal from their own FHSA if each person satisfies the applicable withdrawal conditions.

RRSP-to-FHSA Transfers

Property can generally be transferred directly from an RRSP to an FHSA without immediate tax consequences if there is sufficient FHSA participation room.

A direct RRSP-to-FHSA transfer:

• uses FHSA participation room
• counts toward the applicable lifetime FHSA limit
• does not create a new FHSA tax deduction
• does not restore the RRSP deduction room previously used

For example, assume an individual has $8,000 of available FHSA participation room and directly transfers $5,000 from an RRSP.

After the transfer, the remaining participation room would generally be:

$8,000 − $5,000 = $3,000

The $5,000 direct RRSP transfer would not be deductible as a new FHSA contribution.

Direct transfers are generally completed using Form RC720 or another process accepted by the financial institution.

See the CRA’s RRSP-to-FHSA transfer rules.

What Happens if an RRSP Withdrawal Is Not Transferred Directly?

A normal RRSP withdrawal followed by a separate FHSA contribution is not treated the same as a direct registered-plan transfer.

If RRSP money is withdrawn personally first, the RRSP withdrawal may generally be included in taxable income.

A later FHSA deposit may then be treated as an FHSA contribution if there is sufficient participation room and the other requirements are met.

This is different from a direct RRSP-to-FHSA transfer completed through the registered-plan transfer process.

What Is a Qualifying FHSA Withdrawal?

A qualifying FHSA withdrawal can generally be made without including the amount in taxable income.

The CRA requires several conditions to be met.

Generally, the individual must:

• be a first-time home buyer for purposes of the withdrawal
• have a written agreement to buy or build a qualifying home
• have an acquisition or construction-completion date before October 1 of the year following the withdrawal
• not have acquired the qualifying home more than 30 days before making the withdrawal
• meet the applicable Canadian residency requirement
• occupy or intend to occupy the home as a principal place of residence within one year
• complete Form RC725 and give it to the FHSA issuer

The CRA lists the full conditions on its FHSA withdrawals and transfers page.

The First-Time Buyer Test for a Withdrawal Is Different

The first-time home buyer test used for a qualifying withdrawal is not identical to the test used when opening an FHSA.

For withdrawal purposes, the individual generally must not have lived in a qualifying home as their principal residence that they owned or jointly owned during the current calendar year before the withdrawal, excluding the 30 days immediately before the withdrawal, or during the previous four calendar years.

The CRA’s current withdrawal rules should therefore be checked separately even if the individual qualified when the FHSA was originally opened.

There Is No Fixed $40,000 FHSA Withdrawal Limit

The $40,000 amount is the lifetime FHSA contribution and transfer limit, not a fixed qualifying-withdrawal ceiling.

If investments inside the FHSA have grown, the account may be worth more than the original contributions.

When the conditions for a qualifying withdrawal are satisfied, some or all of the eligible property in the FHSA may generally be withdrawn.

What Counts as a Qualifying Home?

A qualifying home must generally be a housing unit located in Canada.

Examples can include:

• single-family homes
• semi-detached homes
• townhouses
• condominium units
• mobile homes
• apartments in duplexes, triplexes, fourplexes or apartment buildings
• certain shares in co-operative housing corporations that provide an ownership interest

A co-operative share that only creates a tenancy right generally does not qualify under the same rule.

Qualifying FHSA Withdrawals Do Not Have to Be Repaid

A qualifying FHSA withdrawal does not have to be repaid to the FHSA.

This is different from the RRSP Home Buyers’ Plan, which generally requires repayment under its own schedule.

FHSA and the Home Buyers’ Plan Can Be Used for the Same Home

Current federal rules allow an eligible individual to make a qualifying FHSA withdrawal and an eligible Home Buyers’ Plan withdrawal for the same qualifying home, provided the requirements for both programs are satisfied.

The HBP currently allows eligible participants to withdraw up to $60,000 from their RRSPs.

Rule	FHSA	Home Buyers’ Plan
Source of funds	FHSA	RRSP
Contribution / withdrawal framework	$40,000 lifetime FHSA contribution and transfer limit	Up to $60,000 HBP withdrawal
Eligible home withdrawal included in income?	Generally no	Generally no when HBP rules are met
Repayment required?	No	Yes
Can both programs be used for the same home?	Yes	Yes

For a detailed comparison, see our FHSA vs Home Buyers’ Plan guide.

The CRA also provides current information on the Home Buyers’ Plan.

2026 HBP Repayment Relief

The Home Buyers’ Plan has temporary repayment relief for individuals making their first HBP withdrawal from January 1, 2026 through December 31, 2028.

For these withdrawals, the beginning of the 15-year repayment period is deferred to the fifth year following the year of the first withdrawal.

For example, an individual making a first HBP withdrawal in 2026 would generally have the first required repayment year in 2031.

This rule applies to the HBP and does not create a repayment requirement for qualifying FHSA withdrawals.

What Happens After the First Qualifying FHSA Withdrawal?

The first qualifying withdrawal affects the maximum participation period.

The maximum participation period ends on December 31 of the year in which the earliest of these events occurs:

• the 15th anniversary of opening the first FHSA
• the year the holder turns 71
• the year following the first qualifying FHSA withdrawal

The CRA explains these deadlines on its FHSA closing rules page.

The FHSA Maximum Participation Period

The maximum participation period begins when the first FHSA is opened.

It does not restart if the individual later opens another FHSA.

For example, if the 15th anniversary of opening the first FHSA occurs before the year the holder turns 71 and before the year following a qualifying withdrawal, the 15-year rule determines when the maximum participation period ends.

What if the FHSA Holder Does Not Buy a Home?

FHSA property can generally be transferred directly to the holder’s RRSP or RRIF on a tax-deferred basis if the applicable conditions are met.

A qualifying direct FHSA-to-RRSP or FHSA-to-RRIF transfer generally does not:

• create immediate taxable income
• require unused RRSP deduction room
• reduce unused RRSP deduction room

The transfer must be made directly under the registered-plan transfer rules.

If the FHSA property is instead withdrawn as a normal taxable withdrawal, the amount generally has to be included in income.

Form RC721 for FHSA Transfers Out

Form RC721 can be used to request a direct transfer from an FHSA to another FHSA, RRSP or RRIF.

Financial institutions may also use their own documentation where permitted.

A direct transfer is important because a normal withdrawal followed by an RRSP contribution is treated differently for tax purposes.

Excess FHSA Contributions

An excess FHSA amount can arise when contributions and RRSP transfers exceed available FHSA participation room.

The tax on an excess FHSA amount is generally 1% per month on the highest excess amount in the month until the excess is eliminated or otherwise resolved under the applicable rules.

For example, if an individual has $8,000 of participation room and contributes $8,000 in cash, an additional RRSP-to-FHSA transfer may create an excess amount if no additional room is available.

CRA provides detailed calculations on its excess FHSA amounts page.

FHSA Investment Growth

An FHSA can hold different types of qualified investments depending on the issuer and account structure.

Possible investments can include:

• cash
• term deposits
• guaranteed investment certificates
• government or corporate bonds
• mutual funds
• securities listed on designated stock exchanges

Available products depend on the FHSA provider.

Investment gains and losses can change the value of the FHSA, but investment losses inside an FHSA are not generally deductible on an income tax return.

Reporting an FHSA on a Tax Return

When an individual opens a first FHSA, CRA reporting is required even if there were no contributions or RRSP transfers during that year.

Schedule 15, FHSA Contributions, Transfers and Activities, is used to report FHSA information with the income tax and benefit return.

FHSA contributions, transfers and withdrawals may also appear on FHSA tax slips provided by the issuer.

FHSA vs TFSA vs RRSP

The FHSA has its own contribution-room and withdrawal rules and should not be treated as another TFSA or RRSP.

Feature	FHSA	TFSA	RRSP
Contributions generally deductible?	Yes, eligible contributions	No	Yes, subject to RRSP deduction rules
Qualified withdrawals tax-free?	Yes, qualifying home withdrawals	Generally yes	Generally taxable, except qualifying programs such as HBP follow separate rules
Room starts before account is opened?	No	TFSA rules are different	RRSP room follows earned-income and pension-adjustment rules
Home withdrawal repayment?	No for qualifying FHSA withdrawal	No	HBP withdrawals generally require repayment

For a broader comparison of registered savings accounts, see our TFSA vs RRSP in Canada 2026 guide.

FHSA decision worksheet: does waiting to contribute create unlimited room?

No. FHSA participation room starts only when your first FHSA is opened and unused room that carries forward is generally capped at $8,000. That creates an important difference between opening an account and making a contribution. The following scenarios assume no overcontributions, transfers, withdrawals or other FHSA activity.

Person’s FHSA history	2026 illustrative room	Why
Opened first FHSA in 2026	$8,000	First-year participation room
Opened in 2025, contributed $6,000 in 2025	$10,000	$8,000 new room plus $2,000 carryforward
Opened in 2024, contributed nothing in 2024 or 2025	$16,000	2026 new room plus maximum $8,000 carryforward, not $24,000

The third row is the trap: opening an FHSA in 2024 and leaving it empty for two years does not make three full $8,000 annual allowances available in 2026. It is still subject to the carryforward limit. Confirm personal room using CRA’s FHSA participation-room guidance, especially after RRSP-to-FHSA transfers.

Practical decision: if you might buy a qualifying first home, opening an eligible FHSA sooner can start the participation-room clock. But do not open an account solely on that basis without checking qualification, the maximum participation period, investment fees, how soon you will need the money, and whether a TFSA may be more flexible for non-housing goals.

FHSA 2026 Key Rules

Rule	Key Point
First-year participation room	$8,000 after the first FHSA is opened
Carry-forward	Up to $8,000 of unused participation room
Lifetime FHSA limit	$40,000
Contributions	Generally deductible when eligible
RRSP-to-FHSA transfer	Uses FHSA room but is not deductible
Qualifying withdrawal	Generally not included in income
Repayment after qualifying FHSA withdrawal	Not required
Excess amount tax	Generally 1% per month
Maximum participation period	Ends under the earliest applicable 15-year, age-71 or post-withdrawal rule

Frequently Asked Questions

How much FHSA room do I get when I open my first account?

FHSA participation room generally begins at $8,000 in the year the first FHSA is opened.

Does FHSA room accumulate before I open an account?

No. FHSA participation room begins only after the first FHSA is opened.

How much unused FHSA room can be carried forward?

The participation-room carry-forward is generally limited to $8,000.

What is the FHSA lifetime limit?

The lifetime limit is generally $40,000 per individual for contributions and qualifying RRSP-to-FHSA transfers.

Are FHSA contributions tax-deductible?

Eligible personal FHSA contributions are generally deductible. Eligible unused FHSA contributions may also be claimed as deductions in later years under CRA rules.

Are RRSP-to-FHSA transfers deductible?

No. A direct RRSP-to-FHSA transfer uses FHSA participation room but does not create an additional FHSA deduction.

Does an RRSP-to-FHSA transfer restore RRSP room?

No. A direct transfer does not restore the RRSP deduction room previously used.

Can two spouses each have an FHSA?

Yes, if each person independently meets the FHSA eligibility requirements. Each person’s account, participation room and lifetime limit are separate.

Can an FHSA and the Home Buyers’ Plan be used for the same home?

Yes. Current federal rules allow both programs to be used for the same qualifying home if all requirements for both programs are satisfied.

Do qualifying FHSA withdrawals have to be repaid?

No. Qualifying FHSA withdrawals do not have an FHSA repayment requirement.

What happens if I never buy a home?

Eligible FHSA property can generally be transferred directly to the holder’s RRSP or RRIF on a tax-deferred basis, subject to CRA rules.

How long can an FHSA stay open?

The maximum participation period ends on December 31 of the year in which the earliest applicable event occurs: the 15th anniversary of opening the first FHSA, the year the holder turns 71, or the year following the first qualifying withdrawal.

What happens if I contribute too much?

An excess FHSA amount is generally subject to a tax of 1% per month until the excess is resolved under the applicable rules.

---

Disclaimer: This article provides general information about the First Home Savings Account. FHSA eligibility, participation room, tax deductions, transfers and qualifying withdrawals depend on individual circumstances and CRA rules. Confirm current information with the Canada Revenue Agency and the FHSA issuer before making contributions, transfers or withdrawals.