Home Buyers’ Plan (HBP)

Last updated: October 7, 2022

What is the Home Buyers’ Plan?

The Home Buyers’ Plan lets you withdraw up to $35,000 from your RRSP to buy or build your first home in Canada – either for yourself or a relative with a disability. Couples (legally married or common-law) can withdraw up to $35,000 each, for a total of $70,000 towards the same home purchase. When you withdraw this amount, it’s like you’re borrowing from your RRSP. You’re expected to repay the withdrawn funds within a specific period of time. Otherwise, taxes will apply.

Who qualifies as a first-time home buyer in Canada?

To qualify as a first-time home buyer,  neither you nor your current spouse or common-law partner has owned a home in the four-year period leading up to the withdrawal.  However, you don’t have to meet this requirement if you have a disability or if you’re making a withdrawal under the HBP for a relative with a disability.  See the Canada Revenue Agency’s rules: Persons with disabilities.

Other conditions may also apply, including the following:

  • you must live in the home, as your primary residence within one year of acquiring it and
  • neither you or your spouse or common-law partner purchased the home more than 30 days before the withdrawal. 

For a complete list of requirements, please consult with a qualified tax advisor.

Do you have to pay back withdrawals made under the Home Buyers’ Plan?

Yes, you must repay withdrawals made under the HBP within a 15-year period; otherwise, taxes will apply. You don’t have to pay income taxes on the money you take out of your RRSP if you make HBP repayments within the specified timeframe. You can make repayments to any of your RRSPs, a Pooled Registered Pension Plan (PRPP) or a Specified Pension Plan (SPP) within that 15-year period.

When does the Home Buyers’ Plan repayment start?

The 15-year repayment period begins two years after the calendar year in which you make the withdrawal. For example, let’s say you pull money out in 2022. In this case, you’ll have to start making repayments by the end of 2024 or within the first 60 days of 2025. If you don’t make the minimum repayment, you’ll have to include the portion of the amount you didn’t repay as income on your tax return.

What other options do you have for buying a house?

If you’ve saved money in a tax-free savings account (TFSA), you can choose to use that money towards your new home instead of withdrawing from your RRSP under the HBP. Or, you can use your TFSA in combination with your HBP withdrawals to buy or build a home. However, it’s important to note that HBP withdrawals can’t be combined with withdrawals from the Tax-free First Home Savings Account (FHSA). Connect with an advisor to find out which option is right for you.


Need help saving for a house or opening an RRSP?

An advisor can talk you through all your options, answer any questions you have and help you figure out what’s right for you. 

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How long does an RRSP have to be active for a first-time home buyer?

To qualify for the HBP, you must have the funds in your RRSP for at least 90 days. 

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Can I repay the Home Buyers’ Plan early?

Yes, you can repay the HBP back early. But even if you choose to start repaying it earlier than required, it doesn’t reduce your repayment timeframe. You’ll still have to repay the full amount within 15 years. Please consult with a qualified tax advisor to find out if early HBP repayment meets your financial needs. 

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What happens if you don’t pay back the HBP?

You’ll be taking a tax hit on the amount you didn’t repay as required in that year. The amount of tax you’ll have to pay depends on your annual HBP repayment amount or the shortfall in making that annual repayment and your tax bracket for that year. 

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Can I use the Home Buyers’ Plan more than once?

Yes, you can use the HBP more than once if you’ve repaid your previous HBP and your balance is at 0. If you’re separated, divorced or no longer living with your spouse or common-law partner, you must also meet all the other HBP conditions that apply to your situation. Connect with an advisor to discuss your unique situation.

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Can both spouses use the Home Buyers’ Plan?

Yes, each spouse can withdraw up to $35,000 from their RRSP – making a total of $70,000. This is provided all conditions are met under the HBP. Two years after buying a home, each spouse must start making HBP repayments within a specified timeframe. Connect with an advisor for more detailed information.

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Can I cancel the Home Buyers’ Plan if I don’t buy a house?

Yes, in certain situations, you can cancel your participation in the HBP. For example, you can cancel your HBP if you didn’t buy a home or if you become a non-resident of Canada before buying a home.

You’ll have to notify CRA of your intention to cancel and repay the amount. Any portion of your withdrawal that isn’t repaid will have to be included as income in your income tax return. Connect with an advisor for more detailed information

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Where can I learn more about the Home Buyers’ Plan?

An advisor can provide more detailed information about the Home Buyers’ Plan and any other financial products. They can also answer any questions you may have.

Enter your postal code to connect with an advisor near you.