Home Buyers' Plan (HBP)
Canadian ProgramsA program that lets you withdraw up to $60,000 from your RRSP tax-free to buy or build your first home. The money must be repaid to your RRSP over 15 years. If you do not repay, the amounts are added to your taxable income.
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Registered Retirement Savings Plan (RRSP)
A tax-deferred savings account for retirement. Contributions reduce your taxable income now, and the investments grow tax-free inside the plan. You pay tax when you withdraw, ideally in retirement when your income and tax rate are lower.
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First Home Savings Account (FHSA)
A registered account that combines the tax benefits of an RRSP and a TFSA for first-time home buyers. Contributions are tax-deductible (like an RRSP), and withdrawals for a qualifying home purchase are tax-free (like a TFSA). The lifetime contribution limit is $40,000.
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Down payment
The upfront cash you pay when buying a home or other large purchase. In Canada the minimum is 5% on the first $500,000, 10% on any portion between $500,000 and $1.5 million, and 20% on homes priced at $1.5 million or more. A larger down payment means a smaller mortgage and less interest paid over time.