RRSP Home Buyers' Plan (HBP): Complete Guide to Withdrawing for Your First Home

The Home Buyers’ Plan lets you withdraw up to $60,000 from your RRSPs without tax to buy your first home. The trade-off: you must repay it over 15 years. Here is exactly how it works, when it makes sense, and how to maximize the benefit.

How the HBP works

Eligibility requirements

An RRSP withdrawal counts as an eligible HBP withdrawal when:

• You're a first-time buyer: you didn't live in a home you or your current spouse or partner owned in the current year before the withdrawal (other than the 30 days just before it) or in the previous 4 calendar years. This doesn't apply if the withdrawal is for a person with a disability.
• You have a written agreement to buy or build a qualifying home in Canada when you withdraw; a mortgage pre-approval doesn't count.
• You're a resident of Canada when you withdraw and until you buy or build the home.
• You buy or build the home before October 1 of the year after your first withdrawal (with limited extensions for a replacement home or a home under construction).
• You didn't buy the home more than 30 days before the withdrawal.
• You intend to live in the home as your principal residence within one year after buying or building it.
• If you've used the HBP before, your HBP balance on January 1 of the withdrawal year is zero.

In more detail:

The 89-day rule: why timing matters

You can withdraw money you contributed recently, but you may lose the tax deduction for it. You can’t deduct the amount by which your contributions to an RRSP in the 89 days before the withdrawal exceed that RRSP’s value after the withdrawal. Leaving new contributions in for at least 90 days before you withdraw keeps the deduction.

Timing: a lump-sum contribution made 90 or more days before the withdrawal keeps its deduction.

Why it helps: the RRSP contribution is deducted in the year you make it, and the HBP withdrawal isn’t taxed, so money used for the down payment was deducted going in.

Repayment schedule

HBP withdrawals are repaid over 15 years, starting the second year after your first withdrawal (the fifth year for first withdrawals from 2022 to 2028); a required repayment you don't make is added to your income. HBP repayment rules covers the details.

For a first withdrawal made from 2022 through 2028, temporary relief starts repayment in the 5th year after the year of withdrawal; under the standard rule it starts in the 2nd year. Either way, the repayment period lasts 15 years (CRA).

Example: $60,000 withdrawal in 2025

How repayment works

1. Make an RRSP contribution during the year (or within 60 days of year-end)
2. On your tax return (Schedule 7), designate the contribution as an HBP repayment
3. The designated amount reduces your HBP balance — it does NOT give you an additional RRSP deduction

Critical distinction: When you make an RRSP contribution, you choose whether to:

• Claim it as a regular RRSP deduction (reduces taxable income), OR
• Designate it as an HBP repayment (reduces your HBP balance, no tax deduction)

You cannot do both with the same contribution dollar.

What happens if you miss a repayment

Example: Your required repayment is $4,000. You contribute $2,000 to your RRSP and designate it as HBP repayment. The remaining $2,000 is added to your T1 income. At a 33% marginal rate, that costs you $660 in extra tax.

Is the HBP worth it?

When HBP makes sense

When HBP may not be ideal

Opportunity cost example

$60,000 left in an RRSP earning 8% a year would grow to about $129,535 after 10 years and $190,330 after 15. Under the HBP, the money goes back only as it is repaid (at least 1/15 a year, starting the 5th year after a withdrawal made in the relief period), and each repayment only starts growing again once it is back in the plan. How much growth is given up depends on your returns and how fast you repay.

The HBP is essentially an interest-free loan from your future self. The question is whether the benefit of buying now (building equity, avoiding rent increases) outweighs the lost compounding.

HBP + FHSA: the maximum strategy

How the three compare:

1. FHSA: contributions are deductible and a qualifying withdrawal never has to be repaid.
2. HBP: adds RRSP savings on top of the FHSA, but must be repaid.
3. TFSA: no deduction, but withdrawals are tax-free and can be used for anything.

Step-by-step: making an HBP withdrawal

Step 1: Confirm eligibility

Verify you (and your spouse, if applicable) meet the first-time buyer definition.

Step 2: Check the 89-day rule

Contributions made in the 89 days before the withdrawal may not be deductible; see above.

Step 3: Complete Form T1036

Fill out the Home Buyers’ Plan Request to Withdraw Funds form. Your RRSP issuer will need this to release the funds without withholding tax.

Step 4: Submit to your RRSP provider

The provider releases the funds directly to you. No tax is withheld (unlike a regular RRSP withdrawal).

Step 5: Complete the purchase

You must buy or build a qualifying home by October 1 of the year following the withdrawal. If you do not, the withdrawal must be repaid to RRSP or included in your income.

Step 6: Report on your tax return

The withdrawal appears on your T4RSP. Report it on your tax return and claim the HBP exemption (Schedule 7).

Common questions

Can you use HBP for a rental property? No. The property must be intended as your principal residence.

Can you use HBP more than once? Yes, if your HBP balance from a previous participation is zero and you meet the first-time buyer criteria again (no home you owned and lived in during the previous 4 calendar years).

Can you withdraw from a spousal RRSP? Yes, if you’re the annuitant (the spouse the plan is for). The usual 89-day rule limits the deduction for contributions made shortly before the withdrawal, and spousal attribution doesn’t apply to HBP withdrawals.

What if the home purchase falls through? You have until October 1 of the year after withdrawal to complete a qualifying purchase. If you cannot, return the funds to your RRSP by December 31 of that year to avoid taxation.

Tax implications of an HBP withdrawal

Important: HBP repayments are not tax-deductible. You already got the deduction when you originally contributed to your RRSP. The repayment simply restores the tax-sheltered status of those funds.

How to report the HBP on your tax return

Year of withdrawal

Repayment years

Repayment contributions work the same as any RRSP contribution, but only count toward your HBP balance once you designate them as a repayment on Schedule 7 (the designated portion is not tax-deductible, since you already claimed that deduction when you first contributed). You can designate more than your required minimum, and the excess reduces your future required repayments. Your Notice of Assessment and CRA My Account both show your current balance and the minimum required for next year, so it’s worth checking those rather than recalculating by hand. For the full designation steps and what happens with a missed or partial repayment, see our HBP repayment rules guide.

Special cases and exceptions

Spousal HBP

Each spouse or common-law partner can withdraw from their own RRSP under the HBP — each has their own limit, so a couple can withdraw up to $120,000 in total. However, there are rules around spousal RRSPs:

Key point: Attribution rules that normally apply to spousal RRSP withdrawals (the 3-year rule) are waived for HBP withdrawals. That can matter for couples where one partner has contributed to the other’s spousal RRSP.

Disability exception

You do not need to be a first-time home buyer if you qualify for the disability tax credit (DTC) and are buying a more accessible home. This exception also applies if you are withdrawing to help a related person with a disability buy a suitable home.

Relationship breakdown exception

If your marriage or common-law partnership ends, you may qualify for the HBP again even if you owned a home within the last 4 years:

This exception is designed for separated individuals who need to purchase a new home after leaving the matrimonial home.

Related pages

• The first-time home buyer guide
• FHSA / CELIAPP Complete Guide
• First-Time Home Buyer Programs Canada
• First-Time Home Buyer Tax Credit
• How Much Down Payment Do You Need?
• First-Time Home Buyer Guide
• Mortgage Affordability Calculator