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First Home Savings Account (FHSA) Benefits
The FHSA benefits first-time buyers by allowing them to save up to $40,000 for a home through a first home savings account. Contributions made to this account are tax-deductible, and the growth is tax-free. Additionally, withdrawals for a qualifying home purchase are also tax-free, effectively combining the best features of RRSP and TFSA to simplify the path to homeownership.
First Home Savings Account (FHSA)
🔹 What is FHSA? The First Home Savings Account (FHSA) is a Canadian registered account designed to help first-time homebuyers save for a down payment. This account uniquely combines the benefits of an RRSP and a TFSA. One of the significant FHSA benefits is that contributions are tax-deductible, similar to an RRSP, which means they reduce your taxable income. Additionally, it offers tax-free withdrawals and tax-free growth, much like a TFSA, allowing investment income and qualifying withdrawals for your first home to be tax-free. There are limits to consider: an $8,000 annual contribution limit, up to a lifetime maximum of $40,000. Eligibility extends to Canadian residents aged 18–71 who are first-time homebuyers.