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First Home Savings Account (FHSA)


    What’s a First Home Savings Account?

    A First Home Savings Account (FHSA) is a tax-sheltered plan designed to help prospective first-time home buyers save for their first home tax-free, up to certain limits. It combines the attributes of a Registered Retirement Savings Plan and a Tax-Free Savings Account (TFSA).

    What are the key benefits of opening and using a FHSA?

    • Lower your taxable income while saving for your first home
    • Grow your savings using investments in a tax-free shelter
    • Carry over unused contribution room
    • You do not have to repay the withdrawal, the FHSA closes once used for your home purchase.

    Am I eligible to open a FHSA?

    In BC you must meet the following requirements:

    • You’re a resident of Canada and have a valid SIN.
    • You’re a first-time home buyer
    • You’re between the ages of 18 to 71

    Tax deductions for FHSA contributions

    Contributions made to FHSA are generally deductible on your income tax and benefit return for the year of the contribution or a future year, similar to RRSP contributions.

    • Deduction Limit: Over your lifetime, the most you can deduct from your income as an FHSA deduction is $40,000. Transfers from your RRSPs to your FHSAs will reduce this amount.
    • Contribution Deadline: The contribution period for FHSAs is a calendar year (January 1 to December 31). December 31 is the deadline for contributions for this calendar year.
    • Withdrawals: You must be a first-time homebuyer, and the funds must be used to purchase or build a qualifying home in Canada. First Credit Union will guide you through the withdrawal process. You’ll need to provide standard documentation and complete forms before submitting your request. Contact your local branch for details.

    Thinking ahead

    An FHSA can only be open for 15 years and must be closed by the end of the year when you reach age 71, whichever happens first. Additionally, the FHSA must be closed within one year of making a qualifying withdrawal to purchase your first home. You cannot open another FHSA after either one of these events occurs.

    Any amounts in the FHSA that are not used to purchase a qualifying home can be directly transferred to your RRSP or RRIF on a tax-free basis without impacting your RRSP deduction limit.

    Ready to talk about saving for your future?

    Book an in-person or phone appointment with a local financial services representative today.




    Start saving for your first home tax-free!

    We're offering a 3.00% Term Deposit* (GIC) bundled with opening your First Home Savings Account (FHSA)

    • Reduce your taxes while you save for a down payment
    • Start growing your contribution room and carry over unused contributions
    • No need to repay the withdrawal, the FHSA closes once used
    * 6-month redeemable Term Deposit. Terms and conditions apply.
    Woman on lake dock in summer

    Frequently Asked Questions

    1. What is an FHSA?

    An FHSA is a registered plan designed to help prospective first-time home buyers save for their first home tax-free.

    2. How does an FHSA work?

    You contribute to your FHSA, and the contributions are tax-deductible. The investment growth within the account is tax-free. When you’re ready to buy your first home, you can withdraw the funds without paying taxes on the contributions or the gains.

    3. Who is eligible for an FHSA?

    Canadian residents who are first-time home buyers and have not owned a home in the past four years are eligible. You must also have a valid Social Insurance Number (SIN).

    4. What’s the maximum contribution limit for FHSAs?

    The lifetime maximum contribution limit for FHSAs is $40,000. You can contribute up to $8,000 per year, and any unused contribution room carries forward. Important! You only earn carry forward once the plan is opened.  

    5. Can I invest in stocks or mutual funds within my FHSA?

    Yes, FHSAs allow a variety of qualified investments, including stocks, mutual funds, bonds, and other eligible assets.

    6. Can I use my FHSA for anything other than buying a home?

    No, the primary purpose of an FHSA is to save for your first home.

    7. What happens if I don’t use all my FHSA contribution room?

    Once your plan is opened, unused contribution room carries forward for a maximum of 15 years.

    8. Can I transfer funds from my RRSP to my FHSA?

    Yes, you can transfer funds from your RRSP to your FHSA. However, this transfer will reduce your lifetime FHSA contribution limit.

    9. Are there any penalties for over-contributing to an FHSA

    Yes, over-contributions are subject to a 1% monthly penalty tax on the excess amount.

    10. What documentation do I need for FHSA contributions?

    You’ll need to complete Schedule 15 - FHSA Contributions, Transfers, and Activities when filing your income tax return. This informs the Canada Revenue Agency (CRA) about your FHSA contributions and available deduction room.

    *Mutual funds and other securities are offered through Aviso Wealth, a division of Aviso Financial Inc. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments.  Please read the prospectus before investing.  Unless otherwise stated, mutual funds, other securities and cash balances are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer that insures deposits in credit unions. Mutual funds and other securities are not guaranteed, their values change frequently and past performance may not be repeated.