In Canada, the Home Buyer’s Plan (HBP) allows first-time homebuyers to use funds from their RRSPs to purchase a home. Here’s how it works:
Eligibility
To be eligible for the HBP, you must be:
- A first-time homebuyer
- A resident of Canada
- Have a written agreement to buy or build a qualifying home
RRSP Contributions
You can contribute to your RRSP and then withdraw up to $35,000 for the HBP ($70,000 for a couple) without paying tax on the withdrawals.
Repayment
The amount withdrawn must be repaid to your RRSP over a 15-year period, starting in the second year following the year of withdrawal. If you fail to make the required repayments, the amount not repaid is added to your taxable income for that year.
Ready to invest in your first home? Contact us for guidance on RRSP options and other resources for first-time buyers.
