Question 1

What is the annual FHSA contribution limit?

Accepted Answer

The annual FHSA contribution limit is $8,000, with a lifetime maximum of $40,000. Unlike TFSAs, unused room can only carry forward up to $8,000 to the following year. The account must be used within 15 years of opening or by December 31 of the year you turn 71, whichever comes first.

Question 2

How does FHSA carry-forward room work?

Accepted Answer

FHSA carry-forward is unique among Canadian registered accounts. If you contribute less than $8,000 in a year, the unused portion (up to $8,000) carries forward to the following year, allowing you to contribute up to $16,000 in that year ($8,000 current + $8,000 carry-forward). The key restriction: carry-forward room does NOT stack. If you skip TWO years entirely, you still only carry forward $8,000 (not $16,000). The earlier unused year is permanently lost. Carry-forward room is only generated once an FHSA is open, so opening the account early to start the clock is a common strategy even if you do not contribute right away.

Question 3

What if I never use my FHSA for a home?

Accepted Answer

If you don't buy a qualifying first home, you have two options at the end of your participation window (15 years after opening, or by December 31 of the year you turn 71, whichever is earlier): (1) Transfer all funds to your RRSP or RRIF tax-free. This does NOT use any of your existing RRSP room, so it is essentially "bonus" RRSP room of up to $40,000 in contributions plus growth. The funds will be taxed normally as RRSP/RRIF withdrawals later. (2) Withdraw the funds in cash, in which case the entire amount (contributions + growth) is added to your taxable income that year. Option 1 is almost always preferable. Note: a non-qualifying withdrawal is taxable AND triggers a 20% penalty.

Question 4

Can I use both FHSA and RRSP for a home purchase?

Accepted Answer

Yes. You can use your FHSA for a qualifying withdrawal and also use the RRSP Home Buyers' Plan (HBP) simultaneously. The FHSA withdrawal is tax-free and does not need to be repaid. The HBP allows up to $60,000 from your RRSP but must be repaid over 15 years. Combining both can provide up to $100,000 in tax-advantaged funds for a first home.

Question 5

What qualifies as a first home under the FHSA rules?

Accepted Answer

You must not have owned a home that you lived in as your principal residence at any time in the year the account is opened or the preceding four calendar years. The qualifying home must be in Canada and intended as your principal place of residence within one year of purchase.

Question 6

Is the FHSA available in all provinces?

Accepted Answer

Yes. The FHSA is a federal program available to eligible Canadian residents in all provinces and territories. However, some provinces may have their own first-time home buyer programs that can be used alongside the FHSA, such as provincial land transfer tax rebates.

Feature	FHSA	TFSA	RRSP
Contributions Tax Deductible	✓ Yes	✗ No	✓ Yes
Growth Tax-Free	✓ Yes	✓ Yes	✓ Yes
Withdrawals Tax-Free	✓ Yes (for home)	✓ Yes (always)	✗ No
Annual Limit	$8,000	$7,000 (2026)	18% of income
Lifetime Limit	$40,000	Accumulates yearly	None
Best For	First home savings	General savings	Retirement

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