FHSA Transfer to RRSP

How the FHSA-to-RRSP Transfer Works

Section 146.6(8) of the Income Tax Act allows FHSA holders to make a "direct transfer" of FHSA funds to an RRSP or RRIF at any time before the FHSA account must be closed — without triggering income inclusion and without reducing the RRSP's regular contribution room.

This is different from withdrawing the FHSA and re-contributing to an RRSP — which would require sufficient RRSP contribution room. The FHSA direct transfer bypasses the RRSP room requirement entirely.

Why This Makes the FHSA a No-Risk Proposition

The FHSA-to-RRSP transfer mechanism eliminates the downside risk of opening an FHSA. Here is the comparison:

In all three scenarios, you benefited from: (1) the tax deduction when you contributed, and (2) tax-free growth inside the account. The FHSA is essentially a dual-purpose account — home savings account OR bonus RRSP room, depending on life circumstances.

FHSA Transfer vs. Regular RRSP Contribution

A regular RRSP contribution requires available contribution room (18% of prior year income, up to $32,490 in 2026). An FHSA-to-RRSP transfer has no such requirement. This is particularly valuable for:

• High earners who have already maxed their RRSP room
• DB pension plan members whose RRSP room is severely reduced by pension adjustments
• Anyone who wants additional RRSP-style tax sheltering beyond the standard 18% limit

When the FHSA Must Be Closed

The FHSA must be closed (and any remaining balance transferred, withdrawn, or converted) by December 31 of the earliest of:

• The 15th year after the year the FHSA was first opened, or
• The year the account holder turns 71

If the balance is not transferred to an RRSP/RRIF or withdrawn as a qualifying or taxable withdrawal by this deadline, the remaining balance will be included in the holder's taxable income for that year.

Partial Transfers Are Allowed

You do not need to transfer the entire FHSA balance at once. You can make partial transfers to your RRSP at any time — for example, transferring $100 per year over several years. This flexibility allows you to manage RRSP room and timing strategically. Each partial transfer still does not consume RRSP contribution room.

Process: How to Make a FHSA-to-RRSP Transfer

1. Contact your FHSA issuer and request a "direct transfer" to your RRSP or RRIF
2. Complete the required transfer form (your institution will provide it)
3. The transfer must go directly from FHSA to RRSP — you cannot receive the funds and deposit them yourself (that would be a taxable withdrawal)
4. Your FHSA issuer will issue a T4FHSA slip and your RRSP issuer will issue contribution receipts — however, the transfer amount does not appear as an RRSP contribution deduction since no room is consumed