Why the calendar matters
If you’re renting in Edmonton and planning to buy your first place in the next few years, whether that’s a condo downtown, a townhouse in Sherwood Park or a starter home in Spruce Grove or Leduc, the First Home Savings Account (FHSA) is worth a look before the year ends.
The reason is simple: FHSA room is tied to the calendar year, and it only starts once you open your first account. Waiting until January means the current year’s room never starts for you.
The FHSA in plain terms
The CRA describes the FHSA as a registered plan that lets first-time home buyers save to buy or build a qualifying first home tax-free, up to certain limits.
$8,000 to start
Your participation room in the year you open your first FHSA is $8,000. Contributions and transfers from your RRSPs share that room.
Carry-forward, with a cap
Unused room can carry forward, up to $8,000. Nothing carries forward from years before you opened your first account.
$40,000 lifetime
The most you can deduct as FHSA contributions over your lifetime is $40,000.
- Contributions are generally deductible, in the year you make them or a later year. Transfers from your RRSPs to your FHSA are not deductible.
- Room is shared across all your FHSAs. You can have more than one account, but the room covers all of them together.
- Investment growth doesn’t use up room. Income earned inside the FHSA doesn’t count toward your participation room.
- Going over costs you. Contributing more than your room creates an excess amount that the CRA taxes every month until it’s fixed, so check your room before you contribute. You can see it in your CRA account.
Source: CRA, Participating in your FHSAs (opens in a new tab); CRA, Tax deductions for FHSA contributions (opens in a new tab).
What the December 31 deadline actually means
- The contribution period is January 1 to December 31. Contributions for 2026 have to be made by December 31, 2026.
- No 60-day grace period. Unlike an RRSP, FHSA contributions made in the first 60 days of a year can’t be deducted on the previous year’s return.
- Opening the account is what starts the clock. Your $8,000 of room begins in the year you open your first FHSA, even if you don’t contribute right away.
An example from the CRA: someone who opened a first FHSA in 2026 and made no contributions that year saw $16,000 of participation room for 2027: the new year’s $8,000 plus $8,000 carried forward. Had they waited until 2027 to open it, they would have started with $8,000.
One more year-end detail: you need to fill out Schedule 15 with your tax return for the year you open your first FHSA, even if you didn’t put any money in. That’s how the CRA knows the account exists. Financial institutions set their own account-opening processes, so if you’re planning to open one, don’t leave it to the last days of December.
Source: CRA, Tax deductions for FHSA contributions (opens in a new tab); CRA, Participating in your FHSAs (opens in a new tab).
Who can open one
According to the CRA, you must meet all of these when you open the account:
- Age: 18 or older (19 in provinces where that is the age to enter a contract), and no older than 71 as of December 31 of the year you open it.
- Residency: you are a resident of Canada.
- First-time home buyer: in the current calendar year or the previous four, you didn’t live as your principal residence in a home that you owned or jointly owned. If you have a spouse or common-law partner, the same applies to a home they owned.
You open an FHSA through an issuer such as a bank, credit union, or trust or insurance company. There’s also an end date: the CRA says your FHSAs should be closed by December 31 of the year of the earliest of the 15th anniversary of opening your first FHSA, the year you turn 71, or the year after your first qualifying withdrawal.
Source: CRA, Opening your FHSAs (opens in a new tab); CRA, Closing your FHSA (opens in a new tab).
Using it to buy: qualifying withdrawals
A qualifying withdrawal for a first home doesn’t have to be included in your income and doesn’t have to be paid back. The CRA lists conditions, including:
- You are a first-time home buyer at the time of the withdrawal (this test is slightly different from the one for opening the account).
- You have a written agreement to buy or build a qualifying home in Canada, with the purchase or completion date before October 1 of the year after the withdrawal.
- You didn’t acquire the home more than 30 days before the withdrawal.
- You intend to live in it as your principal residence within one year after buying or building it, and you stay a resident of Canada until you buy it.
- You fill out Form RC725 and give it to your FHSA issuer.
If a condition isn’t met, the withdrawal may be taxable. Buying with a partner? Each of you can make a qualifying withdrawal from your own FHSA if you each meet the conditions.
Source: CRA, Withdrawals and transfers out of your FHSAs (opens in a new tab).
FHSA plus the RRSP Home Buyers’ Plan
The CRA says you can use both for the same qualifying home: a qualifying withdrawal from your FHSA and a withdrawal from your RRSPs under the Home Buyers’ Plan (HBP), as long as you meet the conditions for each at the time of each withdrawal.
- The HBP withdrawal limit is currently $60,000.
- HBP withdrawals are repaid to your RRSP over 15 years. For a first HBP withdrawal made between January 1, 2026 and December 31, 2028, repayments start in the fifth year after the withdrawal (for example, a 2026 withdrawal means repayments start in 2031).
- Qualifying FHSA withdrawals don’t have to be repaid.
How to combine them depends on your income, your RRSP savings and your timeline, which is exactly the kind of question to take to a tax professional. On the mortgage side, I can help you see how the money you’ve saved fits with your down payment, closing costs and pre-approval. See my first-time home buyer guide and home purchase mortgages, or run some numbers in the Edmonton mortgage calculator.
Source: CRA, The Home Buyers’ Plan (opens in a new tab); CRA, Withdrawals and transfers out of your FHSAs (opens in a new tab).
A simple year-end checklist
Check whether you qualify
Go through the CRA’s age, residency and first-time buyer conditions.
Check your room before you contribute
If you already have an FHSA, your CRA account shows your participation room. Going over creates a taxed excess amount.
Decide on timing before December 31
If you’re opening your first FHSA this year, give your bank or credit union enough time before year-end.
Talk to a tax professional
Deductions, RRSP transfers and the HBP interact differently for everyone.
Line up the mortgage side
When you’re getting close to buying, a pre-approval (opens in a new tab) helps you shop with a realistic budget. Approval is not guaranteed.
Fully online, anywhere in the Edmonton area
Whether you’re buying in Edmonton, St. Albert, Sherwood Park, Spruce Grove, Leduc, Beaumont, Fort Saskatchewan or elsewhere in the region, we can do the whole process remotely: video meetings, phone calls, e-signing and secure document upload. See how an online mortgage works and the communities I serve.
John Antle, Sub Mortgage Broker - Team Lead, Pineapple National Inc.
General information only. This is not tax advice or personalized financial or mortgage advice. FHSA and Home Buyers’ Plan rules are set by the Canada Revenue Agency and can change; check canada.ca and talk with a tax professional about your situation. Mortgage approval is not guaranteed. O.A.C.
Sources (Canada Revenue Agency, checked November 2026): First Home Savings Account (FHSA) (opens in a new tab); Opening your FHSAs (opens in a new tab); Participating in your FHSAs (opens in a new tab); Tax deductions for FHSA contributions (opens in a new tab); Withdrawals and transfers out of your FHSAs (opens in a new tab); Closing your FHSA (opens in a new tab); The Home Buyers’ Plan (opens in a new tab).