FHSA Save for your first home. Reduce your income tax.

To open an FHSA, you must:

• Live in Canada.
• Have reached the age of majority in your province or territory of residence.
• Be 71 years of age or younger on December 31 of the year you open the account.
• Qualify as a first-time home buyer.

To be considered a first-time home buyer, neither you nor your spouse or common-law partner can have owned and occupied a principal residence during the year the account is opened or during the previous four calendar years.

Typically, no. To open an FHSA, neither you nor your partner can have owned a principal residence during the year you open the account or in the previous four calendar years.

However, if you opened your FHSA before entering into the relationship, you may continue contributing to it and use it toward the purchase of a first home, provided you continue to meet the other eligibility requirements.

Because eligibility rules can vary depending on your specific circumstances, it's a good idea to confirm your eligibility with a financial advisor.

Yes. If you both meet the eligibility requirements, you can each open your own FHSA and save toward the purchase of the same first home. You can then combine the funds accumulated in your respective accounts and use them toward your down payment.

Yes. Anyone can help someone save toward the purchase of a first home.

However, you cannot contribute directly to another person's FHSA. Instead, you can give them money to deposit into their own account, and they will receive the associated tax benefits.

Yes. You can have both a TFSA and an FHSA at the same time. These registered plans have different rules and offer different benefits.

For example, the FHSA is specifically designed to help you save for the purchase of a first home, while a TFSA can be used for any savings goal.

You can also use the savings accumulated in your TFSA to help supplement your down payment.

If you exceed your FHSA contribution room, you may be subject to a 1% tax per month on the excess amount remaining in your account.

If you think you may have overcontributed, contact your advisor as soon as possible to help correct the situation and minimize any potential penalties.

A qualifying home is a property located in Canada that you intend to occupy as your principal residence within one year of purchasing or building it.

Here are a few examples:

• A single-family home
• A semi-detached home
• A town house
• A condo
• A mobile home
• A floating home
• An ownership interest in a co-ownership property
• A share in a housing cooperative that gives you the right to occupy a housing unit

A qualifying withdrawal allows you to withdraw the savings accumulated tax-free from your FHSA to buy or build your first home.

To qualify, you must:

• Have entered into a written agreement to purchase or build a qualifying home.
• Intend to occupy the home as your principal residence within one year of acquiring it.
• Meet all eligibility requirements established by the Canada Revenue Agency.

Before withdrawing your savings, you must complete Form RC725 – Request to Make a Qualifying Withdrawal from an FHSA.

Note that an FHSA can remain open for a maximum of 15 years.

If your plans change, you may be able to transfer the savings accumulated in your FHSA to an RRSP or a RRIF, provided certain conditions are met. The amount transferred does not affect your RRSP contribution room.

You can also withdraw the funds from your account. However, in that case, the withdrawal may be taxable.

Yes. You can transfer the savings accumulated in your FHSA to an RRSP or a RRIF on a tax-deferred basis, provided certain conditions are met.

The amount transferred does not reduce your RRSP contribution room.

This can be an attractive option if you do not use your FHSA to purchase a first home before the account must be closed.