Tax documents: For all tax receipts, see mailing schedule.
First Home Savings Account
Helping you achieve your goal of home ownership
In partnership with Aviso, Alterna is proud to offer the First Home Savings Account (FHSA) to help you save towards your first home.
What is the FHSA?
The FHSA is a registered savings account designed for prospective first-time homebuyers. Similar to an RRSP, it allows you to make tax-deductible contributions. But what sets it apart is its non-taxable withdrawals, similar to a TFSA, which you can use towards purchasing your first home. Plus, you don’t have to ‘pay back’ that withdrawal like you do when you use funds from your RRSP for a down payment.
First step for your first home
The key to unlocking your dreams of home ownership is the tax-free First Home Savings Account (FHSA).
This new registered savings account helps you save for the down payment on your first home faster, with:
▪ Tax-deductible contributions (up to $8,000 each year/lifetime limit of $40,000)
▪ Tax-sheltered savings (investment income and growth within the account are not taxable)
▪ Tax-free withdrawals (on qualifying withdrawals for a first home purchase)
Who can benefit from FHSA?
If you are a Canadian resident, aged  or above, and a first-time homebuyer, you can open an FHSA. You can contribute up to $8,000 annually, with a lifetime maximum of $40,000.
Maximize Your Savings with an FHSA
The FHSA empowers you to save efficiently for your first home. With tax-deductible contributions and tax-free growth, your savings can multiply faster. Plus, you can also carry forward unused contribution room (up to $8,000), ensuring you don't lose out as your income grows.
The FHSA is open to Canadian residents 18 to 71. To participate, an individual cannot be living in a home owned by that person in the year the account is opened, or in any of the four preceding calendar years. This includes a home owned by a spouse or common law partner, similar to the RRSP home buyer’s plan, discussed below.
No tax will apply on FHSA withdrawals used for the purchase of a new home, but only one property will qualify for this special treatment over an individual’s lifetime. All FHSA accounts must be closed by the end of the year following the year of a first qualifying withdrawal, after which the individual may not open another FHSA.
So why wait?
We’re here to support you every step of the way on your journey towards home ownership. Take the first step towards your first home with an FHSA—talk to your advisor today!
All about the tax-free first home savings account
The Canadian government’s new First Home Savings Account (FHSA) came into effect on April 1, 2023. This new registered savings account allows prospective first-time home buyers to save for a down payment on a tax-free basis.
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Frequently Asked Questions
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Frequently Asked Questions
To qualify to open an FHSA, an individual must be:
- at least the legal age of majority in their province/territory of residence (either 18 or 19 years old), but not more than 71 on December 31 of the year; and
- a resident of Canada; and
- a first-time home buyer (buying or building a qualifying home) - see CRA definition for more details.
The FHSA contribution limit for the first year is $8,000, with a lifetime contribution limit of $40,000. Unused contribution room up to a maximum of $8,000 can be carried forward to the following year. Once an FHSA account is opened, further details about amounts (called FHSA participation room) will be provided on a client’s notice of assessment.
For example, if a client opens an FHSA in 2023, they have an $8,000 contribution limit to the end of 2023. Then in 2024, the client has an $8,000 contribution limit plus any of their unused contribution limit from 2023.
If a client opens an account in 2024, they have a contribution limit of $8,000 for the year.
Yes, multiple FHSAs can be opened, as long as the annual and lifetime contribution limits are not exceeded.
The main difference is that the FHSA doesn’t have to be repaid. The FHSA also has a lifetime contribution limit of $40,000. You can make tax-deductible contributions to both FHSA and RSPs (with the intention of making a HBP withdrawal), and withdrawals are tax-free. You can use both FHSA and HBP withdrawals to purchase your first home.
Yes, FHSA contributions are tax deductible (subject to limits), similar to RRSPs. However, unlike RRSPs, FHSA contributions made in the first 60 days of the year cannot be used for the previous year’s taxes.
No, qualifying FHSA withdrawals for the purchase of a first home are not considered taxable income for the year. However, if FHSA funds are withdrawn for other reasons then the amounts are considered as income.
Yes, when the FHSA does not have excess amounts, direct transfers between registered plans (i.e., FHSA to FHSA, RRSP to FHSA, FHSA to RRSP/RRIF) are allowed without any tax consequences. Transferred funds will be subject to regular RRSP/RRIF rules. Note that transfers from RRSPs to FHSAs do not restore unused RRSP deduction room.
Yes, there is a maximum period of 15 years from opening the FHSA to withdrawing the funds for the downpayment of their first home. There is also an age limit, where the FHSA must be used by the end of the year in which the client turns 71. If the funds have not been used, they can be transferred to an RRSP (as a direct transfer and if the FHSA does not have excess amounts).
If the client doesn’t end up using the FHSA to purchase a home, they can either transfer the FHSA to their RRSP (as a direct transfer and if the FHSA does not have excess amounts) or withdraw the money (subject to tax on the contributed amount).
The FHSA holder is the only taxpayer permitted to deduct contributions made to their FHSA. One cannot contribute to their spouse’s FHSA and claim a deduction.
That said, the legislation allows an individual to make FHSA contributions with funds provided by their spouse without attribution rules applying to the income earned in the FHSA from these contributions. Similarly, no attribution arises if cash is given to an adult child to contribute to their FHSA.
Federal legislation allows beneficiaries to be named on FHSAs, as with other registered plans, however the tax consequences depend on whether the beneficiary is a spouse, and whether the beneficiary is a qualified first-time home buyer.
Yes, an FHSA product offering is available for the Qtrade Direct Investing platform.
In general, the preferred custody of assets at Aviso is nominee. Many fund companies are expected to make client name FHSAs available over the next year or two. However, until FHSA plan type can be supported via eAdvisor MFDA and Dataphile, client name FHSAs cannot be offered offline through CAM. (No client name plans are permitted for Credential Securities.)
The same rules apply to FHSAs as other registered accounts, such as RSPs and TFSAs. There may be additional limitations due to minimum investment amounts, with the FHSA contribution limit of $8,000 per year.
OnPoint Managed Portfolio (OMP) ETFs can be held where the minimum will qualify (based on $8,000 per year and $40K lifetime). Also, in the Credential Managed Account (CMA), Guardian funds may be held as well.
We are developing a fully digital account opening process. However, some forms will be offline initially at launch. Watch for training details coming later this fall.
For short time horizons, a Credit Union or Qtrade Direct Investing (QDI) FHSA may be a better fit. In all cases, it is still the advisor’s responsibility to make suitable investment recommendations.
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Mutual funds are offered through Credential Asset Management Inc. Mutual funds and other securities are offered through Credential Qtrade Securities Inc. Credential Asset Management Inc. and Credential Qtrade Securities Inc. are wholly owned subsidiaries of Aviso Wealth Inc.
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