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First-Time Home Buyer Incentives Canada 2026

Updated

Federal Programs and Credits

First Home Savings Account (FHSA)

Feature Details
Annual contribution limit $8,000
Lifetime contribution limit $40,000
Tax deduction ✅ Yes (like RRSP)
Tax on withdrawal for home ✅ Tax-free (like TFSA)
Carry forward unused room Up to $8,000 (starts after first year of account)
Combine with HBP ✅ Yes
Account lifespan 15 years or until first home purchase
If you don’t buy a home Transfer to RRSP (no new room needed)

Maximum benefit: $40,000 in tax-free withdrawals + ~$8,000-$16,000 in tax deductions (depending on bracket).

Home Buyers’ Plan (HBP)

Feature Details
Maximum withdrawal $60,000 per person ($120,000 per couple)
Tax on withdrawal None at time of withdrawal
Repayment Must repay over 15 years (starting 2nd year after withdrawal)
Source RRSP (contributions must have been in RRSP for 90+ days)
If you don’t repay Unpaid portion added to income that year

Combined FHSA + HBP Strategy

Source Per Person Per Couple
FHSA $40,000 $80,000
HBP (RRSP) $60,000 $120,000
Total tax-sheltered $100,000 $200,000

First-Time Home Buyers’ Tax Credit (HBTC)

Feature Details
Credit amount $10,000 × 15% = $1,500
Who qualifies First-time buyer (didn’t own home in past 4 years)
Claimed on Tax return (Line 31270)
Can be split Yes, between spouses (total max $10,000)

GST/HST New Housing Rebate

Home Price Federal Rebate
Under $350,000 36% of GST paid (max $6,300)
$350,000-$450,000 Reduced (proportional phase-out)
Over $450,000 $0 federal rebate

Note: Some provinces have additional provincial rebates with higher thresholds.

Provincial Programs

Ontario

Program Benefit
Land transfer tax rebate Up to $4,000 refund
Toronto municipal LTT rebate Up to $4,475 additional
Combined (Toronto) Up to $8,475
Ontario new housing rebate Up to $24,000 (for new builds)

British Columbia

Program Benefit
Property transfer tax exemption Full exemption up to $500,000
Partial exemption $500,000-$525,000
Newly built home exemption Up to $750,000 (full), $750K-$800K (partial)
BC new housing rebate Up to ~$42,500 on new builds

Alberta

Program Benefit
No land transfer tax ✅ No LTT in Alberta
Mortgage rate cap on insured Standard federal rules

Manitoba

Program Benefit
Land transfer tax rebate Up to $6,750

Saskatchewan

Program Benefit
First-time Home Buyers’ Tax Credit (SK) Up to $1,050 provincial

Prince Edward Island

Program Benefit
Land transfer tax exemption Full exemption on first $200,000

Nova Scotia

Program Benefit
No specific FTB rebate Federal programs apply

Timeline for Maximizing Benefits

When Action
3-5 years before buying Open FHSA, contribute $8,000/year
Ongoing Maximize RRSP contributions (for HBP later)
Tax season Claim FHSA deductions to reduce income tax
91+ days before closing Ensure RRSP funds are eligible for HBP
At purchase Withdraw FHSA (tax-free) + HBP (loan from RRSP)
On tax return Claim HBTC ($1,500)
Moving (if 40+ km) Claim moving expenses on tax return
After purchase Complete GST/HST rebate application (new builds)
2 years later Begin HBP repayment schedule

Down Payment Planning

$500,000 Home

Source Amount Tax Treatment
FHSA $40,000 Tax-free withdrawal + deduction
HBP (RRSP) $60,000 No tax now (repay 15 years)
Personal savings $0-$25,000 After-tax
Total available $100,000 (20%)

Minimum Down Payment Rules

Home Price Minimum Down
Under $500,000 5%
$500,000-$999,999 5% on first $500K + 10% on portion above
$1,000,000+ 20%
Home Price Min Down Payment CMHC Insurance
$400,000 $20,000 (5%) ✅ Required
$600,000 $35,000 (5% + 10%) ✅ Required
$800,000 $55,000 ✅ Required
$1,000,000 $200,000 (20%) ❌ Not available

Who Qualifies as a First-Time Buyer?

Program Definition
FHSA Did not own a home you lived in during the past 4 calendar years
HBP Did not own a home you lived in during the past 4 years
HBTC Same as above
Provincial LTT rebates Varies — check specific province

Note: Each spouse/partner is assessed individually. One partner can qualify even if the other is not a first-time buyer.