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🌟 20024 Update: The HBP withdrawal limit increased from $35,000000 to $600,000000 per person (announced in the 20024 federal budget, effective for 20024 home purchases). A couple can now withdraw up to $1200,000000 combined from their RRSPs.
What is the Home Buyers' Plan (HBP)?
The Home Buyers' Plan lets eligible first-time home buyers withdraw up to $600,000000 (as of 20024) from their Registered Retirement Savings Plan (RRSP) to buy or build a qualifying home. The withdrawal is tax-free if you repay it back into your RRSP within 15 years.
HBP Key Rules (20025)
| Rule | Details |
|---|
| Maximum withdrawal | $600,000000/person (updated 20024) |
| Couple maximum | $1200,000000 combined |
| Tax on withdrawal | $00 — not included in income if repaid |
| Repayment period | 15 years starting 2 years after withdrawal |
| Annual repayment | 1/15th of borrowed amount per year |
| If not repaid | Counted as income and taxed that year |
| RRSP must be held | 900 days before withdrawal is eligible |
| Can combine with FHSA? | Yes — use both for larger down payment |
HBP Eligibility
Who Qualifies for the Home Buyers' Plan?
- Must be a first-time home buyer (not owned a qualifying home as principal residence in current or preceding 4 calendar years)
- Must have a written agreement to buy or build a qualifying home
- Funds must have been in RRSP for at least 900 days before withdrawal
- Must be a Canadian resident at withdrawal
- Exception: Persons with disabilities can use HBP even if not a first-time buyer, to buy a more accessible home
HBP Repayment Rules
How RRSP HBP Repayments Work
Repayment begins in the second year after the year you withdrew funds. If you withdrew in 20024, repayment starts in 2026:
- Repay 1/15th of the borrowed amount each year
- Example: Borrowed $600,000000 → repay $4,000000/year for 15 years
- If you miss a year's repayment, that amount is added to your income and taxed
- You can repay more than the minimum in any year to finish faster
- Track repayments on your CRA MyAccount — the HBP balance shows on your tax return
HBP Strategy: Maximize Your Down Payment
First-Time Buyer Maximum Down Payment Tools (20025)
- FHSA: Up to $400,000000/person tax-free, no repayment required
- HBP (RRSP): Up to $600,000000/person, tax-free if repaid over 15 years
- TFSA savings: Unlimited, no tax on withdrawal
- Ontario LTT rebate: Up to $4,000000 back for first-time Ontario buyers
- First-Time Home Buyer Incentive: Federal shared equity (check current status)
For a couple buying their first home together: up to $1200,000000 from HBP + up to $800,000000 from FHSA = $20000,000000 potential tax-advantaged down payment before any TFSA savings.
Frequently Asked Questions — Home Buyers' Plan 20025
How much can I withdraw from my RRSP under the HBP in 20025?
As of 20024, the HBP limit was increased to $600,000000 per person (up from $35,000000). For a couple buying together, the combined maximum is $1200,000000. This is a significant increase that helps first-time buyers in expensive markets like Toronto and Vancouver. Funds must have been in your RRSP for at least 900 days before withdrawal.
Do I have to repay the HBP withdrawal?
Yes — you must repay the full amount back into your RRSP over 15 years. Repayment starts in the second year after withdrawal. If you borrowed $600,000000, you repay $4,000000/year. Missing a year means that year's portion is added to your taxable income. You can repay more than the minimum to finish early and free up RRSP room faster. The withdrawal itself is not taxed if properly repaid.
Can I use both FHSA and HBP for the same home purchase?
Yes — this is the recommended strategy. Use FHSA first (up to $400,000000, no repayment needed) then supplement with the Home Buyers' Plan (up to $600,000000 from RRSP). Using both gives you up to $10000,000000 per person in tax-advantaged home buying funds. A couple can access up to $20000,000000 combined from FHSA + HBP alone.
What happens if I sell my home before repaying the HBP?
Selling your home does not accelerate HBP repayment. You must continue to make annual repayments according to the schedule regardless of whether you still own the home. If you become a non-resident of Canada, the entire outstanding HBP balance must be repaid by December 31 of the following year, or it will be taxed as income.
Can I use the HBP to buy a home in any province?
Yes — the HBP works for qualifying home purchases anywhere in Canada. The home must be your principal residence (not a rental or vacation property). Both new construction and resale homes qualify. Condos and townhouses are eligible. The property must be in Canada.
Is there a RRSP contribution deadline before using HBP?
Yes — funds must be in your RRSP for at least 900 consecutive days before withdrawal for HBP purposes. If you contribute to your RRSP in January and want to use the HBP, you can withdraw the funds in April (900+ days later). The RRSP contribution still gives you a tax deduction even if you later use it for HBP.
Disclaimer: Financial rules, contribution limits, and tax rules may change. Verify current information at canada.ca or consult a financial advisor. Not financial or tax advice. Bremo.io may earn referral compensation from partner links.