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Home Buyers Plan (HBP) Repayment Rules in Canada (2026)

Updated

HBP Repayment Basics

The Home Buyers’ Plan allows you to withdraw up to $60,000 from your RRSP to buy your first home. You must repay this amount over 15 years.

Feature 2026 Rules
Maximum withdrawal $60,000
Repayment period 15 years
Annual repayment At least 1/15th
Repayment starts 2nd year after withdrawal year
No deduction Repayments are not tax-deductible

Repayment Timeline

When Repayments Start

Withdrawal Year Repayments Begin First Payment Due
2024 2026 (for 2025 tax year) March 1, 2026
2025 2027 (for 2026 tax year) March 3, 2027
2026 2028 (for 2027 tax year) March 1, 2028

You have a 2-year grace period before repayments begin.

15-Year Repayment Schedule

For a $60,000 withdrawal:

Year Required Payment Remaining Balance
1 $4,000 $56,000
2 $4,000 $52,000
3 $4,000 $48,000
4 $4,000 $44,000
5 $4,000 $40,000
… … …
15 $4,000 $0

How to Make HBP Repayments

Designating Your Payment

  1. Make an RRSP contribution as normal
  2. Complete Schedule 7 with your tax return
  3. Designate the contribution as HBP repayment
  4. Do not claim a deduction for the repayment portion

Example Tax Return Entry

RRSP Activity Amount Deductible?
Total RRSP contribution $10,000 —
Minus: HBP repayment $4,000 No
Deductible contribution $6,000 Yes

Deadline

Tax Year Contribution Deadline Repayment Deadline
2025 March 1, 2026 March 1, 2026
2026 March 3, 2027 March 3, 2027

Repayments follow the same deadline as RRSP contributions — the first 60 days of the following year.

What Happens If You Miss a Payment

If you don’t designate enough as an HBP repayment, the shortfall is added to your income:

Example of Missed Payment

Situation Amount
Required repayment $4,000
Amount designated $1,500
Shortfall $2,500
Added to taxable income $2,500

Tax Impact of Non-Repayment

Taxable Income Marginal Rate Tax on $2,500 Shortfall
$55,000 ~30% ~$750
$100,000 ~43% ~$1,075
$150,000 ~48% ~$1,200

The money isn’t “repaid” to the CRA — instead, you lose the tax-sheltered status of that amount.

Impact on Future Minimum Payments

If You Pay Extra

Extra payments reduce your balance and future minimums:

Scenario Year 1 Payment Remaining Year 2 Minimum
Minimum only $4,000 $56,000 $4,000
Pay extra $10,000 $50,000 $3,571

If You Miss a Payment

Missed amounts are removed from your balance (as taxable income), reducing future minimums:

Scenario Year 1 Action New Balance Year 2 Minimum
Full payment $4,000 repaid $56,000 $4,000
Missed entirely $0 repaid $56,000 $4,000

Note: Missing doesn’t change your balance for minimum calculation purposes — CRA still calculates on original schedule.

Special Situations

Selling Your Home

Situation HBP Impact
Sell home Keep repaying as normal
No acceleration Repayment schedule unchanged
Move to rental Keep repaying

Selling your home does not affect your HBP repayment schedule.

Buying Again

Situation Rules
HBP balance outstanding Can use HBP again after 4 years as non-owner
Fully repaid Can use HBP again if qualified
Partial balance Can use HBP if meet all conditions

Marriage/Separation

Situation Impact
Marriage Each spouse can use HBP ($120,000 combined)
Separation Each continues their own repayments
Spousal RRSP Repayments go to spousal RRSP owner’s account

Death

Situation Outcome
Die before repayment complete Outstanding balance added to final return income
Exception Balance can transfer if qualifying beneficiary

HBP Repayment Strategies

Pay Extra When Possible

Strategy Benefit
Pay extra in high-income years No deduction anyway
Reduces future minimums More flexibility later
Faster return to RRSP Resumes sheltered growth

Prioritize vs Other Goals

Comparison Recommendation
HBP vs high-interest debt Pay debt first
HBP vs TFSA Consider TFSA first (tax-free growth)
HBP vs RRSP (deductible) Deductible RRSP has immediate tax benefit
HBP vs mortgage prepayment Depends on mortgage rate vs investment return

Strategic Non-Repayment

In some cases, intentionally not repaying may make sense:

Situation Consideration
Very low income year Shortfall taxed at lower rate
Moving abroad Different tax situation
Terminal illness Immediate cash needs

This is an advanced strategy — consult a tax professional.

Checking Your HBP Balance

CRA My Account

  1. Log in to CRA My Account
  2. Go to Tax returns > RRSP and TFSA
  3. View HBP section
  4. Shows: Original withdrawal, repayments made, balance owing

Notice of Assessment

Your annual Notice of Assessment shows:

  • HBP balance
  • Required repayment for next year
  • Repayments made

Schedule 7

When filing taxes, Schedule 7 shows:

  • RRSP contribution room
  • HBP repayment calculation
  • Designation of repayment amount

Common HBP Repayment Mistakes

Mistake Consequence
Forgetting to designate Contribution deducted, HBP not repaid = double issue
Missing deadline Shortfall added to income
Claiming deduction Can’t deduct HBP repayments
Not checking balance May lose track of minimum
Confusing with LLP Different programs, different repayments

HBP vs LLP Repayment Comparison

Feature HBP LLP
Purpose Home purchase Education
Maximum $60,000 $20,000
Repayment period 15 years 10 years
Grace period 2 years 5 years (or 2 years after school)
Annual minimum 1/15th 1/10th

Repayment Calculator Example

$60,000 Withdrawal

Repayment A mount Time to Repay Total Missed Deductions
$4,000/year (min) 15 years N/A (repaid = no deduction either way)
$6,000/year 10 years N/A
$8,000/year 7.5 years N/A
$0/year (all added to income) N/A $60,000 over 15 years

Key Takeaways

  • Repayments begin 2 years after withdrawal
  • Minimum is 1/15th of withdrawal each year
  • Repayments are not tax-deductible
  • Missed payments become taxable income
  • You can pay more than the minimum to reduce balance faster
  • Check your balance regularly on CRA My Account
  • Designate contributions properly on Schedule 7