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First Home Savings Account (FHSA)

First Home Savings Account (FHSA)

Earn 5.00%* when you open an FHSA High Interest Savings Account.

What is a First Home Savings Account (FHSA)?

The FHSA is a tax-free1 way to save for a down payment on your first home. FHSA contributions are tax deductible, and your savings will grow tax-free, just like your Registered Retirement Savings Plan (RRSP). You can also take out money from your FHSA for a qualifying home purchase without paying tax2.

Whether you’re just starting out or have been putting away money for a down payment for a while, this new registered account makes it easier to reach your home ownership goals, faster.

Why should I open an FHSA?

Grow your savings, tax-free

Whether you invest in high-interest savings accounts, GICs, mutual funds or other investments, your FHSA savings will grow, tax-free1, allowing you to keep more of the money you put away for your first property.

Reduce your taxable income

When you put money into your FHSA, every dollar can reduce your taxable income for the year (just like contributions to an RRSP).

Flexible ways to invest

Change of plans? No problem. Any unused FHSA savings can be transferred, without being taxed, to another registered account, such as your RRSP or Registered Retirement Income Fund (RRIF).

Who is eligible to open an FHSA?

Canadian residents between the ages 18 and 71 are eligible to open an FHSA3. Keep in mind, when it comes time to use your FHSA money for a home, there are a few restrictions, including:

  • You must be a Canadian resident and a first-time homebuyer
  • You’ll need proof that you intend to purchase or build a qualifying home
  • You must plan to occupy the home within one year, as your principal residence
  • You must have a valid Social Insurance Number

The Canada Revenue Agency (CRA) considers you a first-time homebuyer if you have not occupied a home that you, or your current spouse or common-law partner, have owned in the last four years. If you live with a disability, or are helping a disabled relative to buy or build a home, there may be exceptions. 

Find out more at Canada Revenue Agency’s FHSA page.

What are the limits for FHSA contributions and withdrawals?

Just as you need to keep contribution and withdrawal limits in mind for your RRSP and TFSA, it's important to understand the guidelines surrounding your FHSA, so you can make the most of its tax benefits.

Annual limit of $8,000

Contribute up to $8,000 to your FHSA every year. Every dollar you put into your FHSA is tax-deductible1, which can reduce your taxable income.

Lifetime limit of $40,000

With a lifetime contribution limit of $40,0004, your FHSA can remain open for up to 15 years (or until the end of the year you turn 71), with the freedom to carry forward up to $8,000 in unused contribution room from one year to the next.

No-limit withdrawals

When it’s time to use your FHSA for a home purchase, you can withdraw the entire amount you’ve saved. Qualified FHSA withdrawals won’t be taxed2, which means your savings can be used directly towards your home.

How to open an FHSA with Meridian

When you’re ready to open an FHSA, you want flexibility, support, and the best opportunity to grow your savings. At Meridian, we’re proud to offer several investment options as you save towards your first home.

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High Interest Savings Account

Earn 5.00%* when you open an FHSA high interest savings account (or HISA). This is a risk-free place to hold funds within your FHSA. In some ways, it functions like a regular savings account that pays you interest on your balance. You can move HISA savings to a GIC, or to other types of investments within your FHSA, at any time.

Explore the HISA

How does an FHSA compare to an RRSP or TFSA?

The FHSA has similar tax benefits to RRSPs and TFSAs. Like an RRSP, FHSA contributions are tax deductible, and your savings will grow tax-free1. Like a TFSA, you can withdraw your savings without having to pay tax2, as long as the withdrawal is for an eligible home purchase.

The tax benefits of the FHSA, RRSP, and TFSA can make a big difference in the long run. While you can invest in all three registered plans at once, if you’re wondering where to contribute first, it’s important to consider your stage of life, your timeline, and your financial goals.


Frequently asked questions

Questions? There are several ways to get in touch.

Mutual funds and other securities are offered through Aviso Wealth, a division of Aviso Financial Inc. Online brokerage services are offered through Qtrade Direct Investing, a division of Aviso Financial Inc. Qtrade and Qtrade Direct Investing are trade names or trademarks of Aviso Wealth Inc. and/or its affiliates.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Unless otherwise stated, mutual funds, other securities and cash balances are not covered by the Canada Deposit Insurance Corporation or by any other government deposit insurer that insures deposits in credit unions. Mutual funds and other securities are not guaranteed, their values change frequently and past performance may not be repeated.