How does the First Home Savings Account work?
Quick Answer
Short answer: Contribute pre-tax, invest, then withdraw both principal and growth tax-free for your first home.
Detailed Explanation
The FHSA blends RRSP-style tax deductions with TFSA-style tax-free withdrawals. You must open the account before age 71 and use the funds within 15 years or before the end of the year you turn 71. Unused balance can transfer to your RRSP without affecting contribution room.
Annual limit is $8,000; unused room carries forward, capped at $40,000 lifetime. Investment options mirror RRSP/TFSAs—GICs, ETFs, mutual funds.
- Must be a Canadian resident and first-time buyer
- Can hold multiple FHSA accounts across institutions
- Withdrawal must be within 30 days of closing
Disclaimer: This page is for general information only and does not constitute legal, financial, or real estate advice. Always verify details with a licensed Alberta REALTOR®, mortgage professional, or lawyer before making decisions. Buy in Edmonton assumes no liability for actions taken based on this content.
Tim Grover, RE/MAX Excellence • 780-288-5144 • 5607 199 Street NW, Edmonton, AB
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