FHSA Planner
How big a down payment can the First Home Savings Account build by your purchase year — and how much tax does Ottawa hand back along the way? 2026 rules: $8,000 a year, $40,000 lifetime, deductible going in and tax-free coming out.
FHSA vs the same savings, taxed
Your tax-free balance against identical out-of-pocket savings in a taxable account, where growth is taxed as it happens.
Year-by-year plan
Contributions, refunds and balances. The highlighted row is where you max the $40,000 lifetime limit.
| Year | FHSA contribution | Tax refund | FHSA balance | Side TFSA | Taxable account |
|---|
How this is calculated
Contribution rules (2026)
The FHSA gives you $8,000 of participation room per year and a $40,000 lifetime limit. Up to $8,000 of unused room carries forward, so a catch-up year can absorb $16,000 — but because this planner models a steady plan, carry-forward never accrues, and each year simply contributes min($8,000, your amount) until the lifetime limit is used. Your starting balance is assumed to be entirely contributions; if part of it is growth, you have more room than shown.
Growth and refunds
Each year's contribution is invested in 12 equal monthly parts, and the balance compounds at (1 + r)^(1/12) − 1 per month. Contributions are deductible, so each year generates a refund of contribution × marginal rate. By default the refund is treated as cash in your pocket, not new savings. Flip reinvest refunds and each refund is added to the following year's contribution — anything that doesn't fit under the $8,000 annual / $40,000 lifetime FHSA caps spills into a side TFSA at the same return. Reinvested FHSA dollars are themselves deductible, so they generate their own refunds. You can also carry the deduction forward and claim it in a higher-income year — this tool assumes you claim it right away at the rate you enter.
The taxable comparison (an approximation)
The dashed line puts the same out-of-pocket savings in an unregistered account earning r × (1 − 50% × marginal rate) — that is, growth taxed each year at your capital-gains rate (50% inclusion, confirmed after the 2/3 proposal was cancelled in March 2025). Real taxable investing is messier: capital gains are deferred until you sell (less drag), while interest and foreign dividends are taxed at your full rate (more drag). Annualizing the drag is a deliberate middle-of-the-road simplification.
Who can open one, and the clock
You must be a Canadian resident, at least 18 (or the age of majority in your province) and at most 71, and a first-time buyer: you didn't live in a home that you or your spouse/common-law partner owned during the current calendar year or the previous four. The account must close by December 31 of the 15th year after opening, the year you turn 71, or the year after your first qualifying withdrawal — whichever comes first. Unused money rolls into your RRSP or RRIF tax-free without using any RRSP room.
Stacking with the Home Buyers' Plan
The FHSA stacks with the HBP: you can also withdraw up to $60,000 from your RRSP for the same first home. The difference: HBP money is a loan from your own retirement savings, repaid over 15 years starting the second year after withdrawal (missed repayments are added to your taxable income). FHSA qualifying withdrawals are never repaid.
Why the FHSA beats both RRSP-HBP and TFSA for a first home
It combines the best half of each: an RRSP-style deduction going in and a TFSA-style tax-free withdrawal coming out, with no repayment obligation. A TFSA gives no deduction; the RRSP-HBP must be paid back. For a first-home fund, fill the FHSA before either.
What this doesn't model
Carry-forward room from missed years, deferring deductions to higher-income years, investment fees, return volatility, HBP repayments, or Quebec's separate return (Quebec mirrors the federal FHSA treatment). Once you know your down payment, run the mortgage calculator and the affordability calculator for the rest of the purchase.