First Home Savings Account (FHSA)
Tax-free savings for your first home.
Jumpstart your savings by 3.00%
Enjoy flexibility and great returns on personal deposits for a limited time when you open a Jumpstart™ High Interest Savings Account for your FHSA. Conditions apply.1
What’s an FHSA and why get one?
A First Home Savings Account (FHSA) is a tax-free way to save towards your first home.
Grow your savings
Invest your hard-earned money, grow it tax-free, and withdraw it when you find your first home.
Enjoy tax-free qualified withdrawals2
Qualified withdrawals from your FHSA to buy a home won’t be taxable.
Pay less income tax
Contributions can be used as deductions against your earned income, lowering the tax you pay when you file your return. And like a TFSA, your investment earnings won’t be taxed either.
How an FHSA works.
Open a FHSA
To be eligible you must:
- Be a Canadian resident
- Have a valid SIN (Social Insurance Number)
- Be 18 years or older4
- Be a first-time home buyer5
Plus, at Vancity, you have the opportunity to invest in a world you want to live in with socially responsible investing options.
Not sure what qualifies as a first home? See FAQs
Choose an investment “vehicle”
These are the actual investments that go into your account. Our FHSA Jumpstart™ High Interest Savings Account is a low-risk option, while our mutual funds* have a variety of risk levels. You can also choose a mix.
Talk to an advisor today to get personalized advice.
Make deposits and review your progress
Put your money into the investment, or multiple investments, that you chose. Be aware that an over contribution will result in a penalty tax.6
Over time, you could see your investment grow. As time passes, continue to make contributions and even add different types of investments to the mix so you could save and earn more.
Every year at tax season
With an FHSA you can deduct your contributions from your taxable income and save taxes, just like you can with an RRSP. Note, you don’t have to deduct your contributions within the same year that you make them.3 In some cases, you may see more benefit in deducting over several years, or in higher income years.
Investment income you make through your FHSA won’t be taxed if you use the funds to buy or build your first home.3
Withdraw when you find your first home
You can deduct your contributions from your taxable income and save taxes. Note, you don’t have to deduct your contributions within the same year that you make them. In some cases, you may see more benefit in deducting over several years, or in higher income years.
FHSA takeaways.
$8,000
Contribution room
Contribute up to $8,000 to your FHSA every year up to a lifetime contribution limit of $40,000. Once opened, you can carry forward up to $8,000 per year in unused contributions, subject to the lifetime limit.7
15 years
Timeline
You can generally keep your FHSA open for 15 years. If you don’t end up buying a home, you can transfer your FHSA savings to an RRSP or RRIF without paying taxes on the transfer, subject to certain conditions.8
Tax-free
Qualified withdrawals
Qualifying withdrawals from your FHSA to purchase your first home are non-taxable. Plus, unlike the Home Buyer’s Plan in a RRSP, the withdrawals don’t need to be repaid.
Dec 31
Annual contribution deadline
The annual contribution period for the FHSA is January 1 to December 31. Deposit to your FHSA before December 31 to have your contribution amount deducted from your taxable income for that financial year.
Ask a pro.
We can help you choose investment options to help you grow your downpayment.
Open an account.
If you’re already a member, you can log in to digital banking to open an FHSA term deposit or savings account.
Read the home buyer guide.
Get advice and resources to support your homebuying journey.
Questions? We have answers.
Get more from your FHSA.
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.
Your deposits in this account are 100% protected by the Credit Union Deposit Insurance Corporation of British Columbia (CUDIC).
Vancity is a BC Financial Services Authority authorized credit union and is covered by the Credit Union Deposit Insurance Corporation of British Columbia (CUDIC). To find out more about this coverage, visit the CUDIC website or ask us for more details.
Rate is subject to change or may be withdrawn without notice at any time. Interest is calculated on closing daily balance in an Account and paid at month-end. The interest is an annual interest rate. Interest is earned in the currency of the account. Promotional interest rate will not be earned on pre-existing Vancity accounts.
Withdrawals from the FHSA to purchase a qualifying home must be made using a prescribed form.
To withdraw funds on a non-taxable basis, the holder must:
- Be a first-time homebuyer at the time of withdrawal;
- An individual counts as a first-time homebuyer for this purpose where, during the 4 previous calendar years and during the period of the current year ending 31 days before the withdrawal was made, the individual did not live in a home that they owned or jointly owned.
- Have a written agreement in place before the withdrawal to buy or build a qualifying home (in Canada) with the acquisition or completion date of the qualifying home before October 1 of the year following the date of the withdrawal;
- Intend to occupy that home as the principal place of residence within 1 year of acquiring the qualifying home;
- Be a resident of Canada from the time of the withdrawal until the home is acquired; and
- Not have acquired the qualifying home more than 30 days before the withdrawal is made.
If the above conditions are met, the entire balance in the FHSA can be withdrawn on a tax-free basis in a single withdrawal or a series of withdrawals.
Please consult your tax advisor for more information on potential tax implications.
To open an FHSA, the individual must be a resident of Canada with a SIN who has reached the age of 18 years or older but not more than 71 years on December 31 of the year you open an FHSA.
An individual is considered to be a first-time home buyer if at any time in the part of the calendar year before the account is opened or at any time in the preceding four years they did not live in a qualifying home (or what would be a qualifying home if located in Canada) that either (i) they owned or (ii) their spouse or common-law partner owned (if they have a spouse or common-law partner at the time the account is opened).
Members are responsible for their CRA contribution limits for registered plans and knowing what those limits are. Vancity is not responsible for any loss or damage from over contributions.
Starting in the year the FHSA is opened, the holder can contribute, or transfer from an RRSP, a total of $8,000, plus any carry-forward available. The maximum lifetime amount that can be contributed or transferred to an FHSA is $40,000. An individual may carry-forward up to $8,000 of any unused contribution room in any year. Carry-forward amounts only start accumulating after an individual opens an FHSA for the first time. Unlike RRSPs, contributions made within the first 60 days of a subsequent year can’t be deducted in the previous tax year.
Where a holder transfers an amount from their RRSP into their FHSA, it would not be a taxable withdrawal from their RRSP (however they would not get back any RRSP contribution room).
Individuals can own more than one FHSA but the total amount they may contribute to all of their FHSAs cannot exceed their annual and lifetime contribution limits. Individuals must keep track of their own contribution room. There is a 1% per month penalty tax on any overcontributions.
Similar to RRSP contributions, there is no requirement to claim the FHSA deduction in the tax year in which a contribution is made. The amount can be carried forward indefinitely and deducted in a later tax year.
The FHSA can remain open for a maximum of 15 years, subject to the following conditions:
FHSA must be closed at the end of the year in which the earliest of the following events occur:
- the 15th anniversary of opening your first FHSA; or
- you turn 71 years of age (an FHSA can be opened at age 71 but has to be closed before the end of the year); or
- the year following your first qualifying withdrawal from your FHSA; or
- The plan holder dies.
Savings in the FHSA not used to buy a qualifying home can be transferred on a tax-deferred basis into an RRSP (without specifically needing contribution room) or registered retirement income fund (RRIF); or withdrawn on a taxable basis.
Taxable withdrawals will be subject to withholding tax (at the same rates as RRSP withdrawals, except for in Quebec where the rates will be similar to taxable withdrawals from an RESP).