Buying your first home can seem financially out of reach. That's why it's important to understand the rules and programs designed to assist first-time homebuyers.

Home Buyers' Plan (HBP)

To facilitate homeownership for Canadians, the government has implemented a valuable program called the Home Buyers' Plan (HBP). Are you familiar with it? This program allows eligible individuals to withdraw up to $35,000 from their Registered Retirement Savings Plans (RRSPs) to purchase or construct a qualifying home, tax-free. This contribution can significantly boost a homebuyer's purchasing power.

To qualify for this program, you must meet the following criteria:

  1. First-time home buyer;
  2. To have a written agreement to purchase or construct a qualifying home for yourself or a related person with a disability;
  3. To be a resident of Canada at the time of withdrawing funds from your RRSP under the HBP and to maintain that residency until the qualifying home is purchased or constructed;
  4. To have the intention of occupying the qualifying property as their primary residence within twelve months of purchase or construction.
first owner

Good to know

Any funds withdrawn from an RRSP under the HBP must be repaid within 15 years of the withdrawal. Additionally, individuals who have previously participated in the HBP may re-enroll if their previous HBP balance has been fully repaid by January 1st of the year in which the new withdrawal is made.

What is the deadline for making RRSP contributions that can be claimed as a deduction on your 2024 tax return?

The deadline to make RRSP contributions for the 2024 tax year is March 3, 2025.

RRSP withdrawal conditions

This program allows you to leverage your savings for a significant milestone in your adult life. However, careful planning is essential to maximize its benefits. To be eligible for the Home Buyers' Plan, funds must remain in your RRSP for at least 90 days prior to withdrawal.

To learn more about the eligibility criteria and to access the T1036 form, visit the official government website.

Do you have questions about your financial strategy? Contact a Proprio Direct real estate broker today. They can connect you with the right professionals to guide you through the process.