Key Takeaway

The Home Buyers’ Plan (HBP) allows eligible first-time home buyers in Canada to withdraw up to $60,000 from their Registered Retirement Savings Plan (RRSP) tax-free to use toward a down payment. You must repay the amount over 15 years, starting the second year after withdrawal. Use the calculator below to determine how much you can borrow from your RRSP and plan your repayment schedule based on your timeline and financial situation.

What Is the Home Buyers’ Plan?

The Home Buyers’ Plan is a federal program administered by the Canada Revenue Agency (CRA) that lets you borrow money from your own RRSP to buy or build a qualifying home without paying tax on the withdrawal. According to the Canada Revenue Agency, you can withdraw up to $60,000 per person (up to $120,000 per couple if both partners are first-time buyers with sufficient RRSP savings) (CRA, 2026).

The program is designed to help Canadians enter the housing market by making larger down payments accessible, potentially reducing the need for mortgage default insurance and lowering monthly mortgage payments.

How the Home Buyers’ Plan Works

When you participate in the HBP, you withdraw funds from your RRSP that you have contributed and that have been in the account for at least 90 days. The withdrawal is not considered taxable income in the year you take it out, which means you will not owe income tax on that amount as long as you follow the repayment rules.

You can use HBP funds for a down payment, but not for mortgage payments, legal fees, land transfer tax, or other closing costs. The home you purchase must be your principal residence, and you must have a written agreement to buy or build a qualifying home before October 1 of the year following the withdrawal.

Eligibility Requirements

To qualify for the Home Buyers’ Plan in Canada, you must meet these conditions:

  • Be a first-time home buyer (you cannot have owned a home that was your principal residence in the current year or the previous four calendar years)
  • Have a written agreement to buy or build a qualifying home
  • Intend to occupy the home as your principal residence within one year of buying or building it
  • Be a resident of Canada when you withdraw the funds and up to the time you buy or build the home
  • Have the funds in your RRSP for at least 90 days before withdrawal

If you are buying a home for a related person with a disability, different first-time buyer rules may apply.

Repayment Rules and Timeline

You must repay the full amount you withdrew to your RRSP over a maximum 15-year period. Repayments begin the second year after the year you made the withdrawal. For example, if you withdrew funds in 2026, your first repayment is due by the end of 2028.

Read also: RRSP Home Buyers Plan: Using Your RRSP for a Down Payment in Canada

Each year, you must repay at least 1/15 of the total amount withdrawn (approximately 6.7 per cent annually). If you do not make the minimum repayment in a given year, the Canada Revenue Agency adds the shortfall to your taxable income for that year. You can repay more than the minimum at any time to pay off the balance faster and reduce future repayment obligations.

The Financial Consumer Agency of Canada notes that planning your repayment schedule carefully is essential, especially if you are also managing a new mortgage, property taxes, and other home ownership costs (FCAC, 2026).

Why Use the Home Buyers’ Plan Calculator?

The HBP calculator helps you model different scenarios before you withdraw funds from your RRSP. You can enter your current RRSP balance, the amount you plan to withdraw, and your expected timeline to see your annual repayment obligation and total repayment schedule. The calculator also shows how much RRSP contribution room you will need each year to stay on track, which is important if you are contributing to your RRSP for other goals like retirement.

By using the calculator, you can compare withdrawing the full $60,000 versus a smaller amount, assess whether you can afford the annual repayments alongside your mortgage, and decide if the HBP is the right strategy for your down payment or if you should consider other sources of funds.

Important Considerations

Withdrawing from your RRSP reduces the long-term growth of your retirement savings. The funds you take out will not earn investment returns while they are outside your RRSP, and you lose the compounding growth on those dollars until you repay them. The Canada Mortgage and Housing Corporation recommends weighing the benefit of a larger down payment (lower mortgage, potentially avoiding CMHC insurance premiums) against the cost of reduced retirement savings (CMHC, 2026).

Additionally, if you do not repay the minimum amount each year, the shortfall is added to your taxable income, which could push you into a higher tax bracket and result in a larger tax bill. Plan your repayment carefully and consider setting up automatic contributions to your RRSP to meet the annual requirement.

Disclaimer

This article provides general educational information about the Home Buyers’ Plan in Canada and is not personalized financial, tax, legal, or investment advice. Eligibility, withdrawal limits, and repayment rules are set by the Canada Revenue Agency and are subject to change. The calculator provides estimates only and does not constitute an offer or commitment. Your personal circumstances, RRSP balance, tax situation, and home purchase timeline vary, and rules differ by province and territory. Consult a licensed financial advisor, mortgage professional, or tax specialist for advice tailored to your situation, and verify current HBP rules and limits with the CRA before making any decisions. Information is current as of July 2026; regulations and limits may change.