In most instances, when you withdraw money from your RRSP, you have to pay taxes on that money as though it were income – but not when you use the withdrawal to purchase your first home!
The Home Buyers’ Plan (HBP) allows you to withdraw up to $35,000 from your RRSP tax free so you can buy your first home. Even your spouse can take advantage of this program if they’re eligible, meaning together you could have a total of $70,000 for a down payment! Plus, you’ll have 15 years to repay your RRSP without penalty.
The Home Buyers’ Plan could be your golden ticket to securing your first home!
To be eligible, you’ll need to:
- Be a first-time homebuyer. That means, neither you nor your spouse can have owned a home within the last four years. This condition may be exempt if you are a person with a disability or are buying a home for a person with a disability.
- Have a written agreement to buy or build a qualifying home.
- Intend for this home to be your primary place of residence within one year of buying or building it.
- Be a resident of Canada at the time you withdraw your RRSPs
As an added benefit, both you and your spouse can withdraw funds from your First Home Savings Account (FHSA) along with funds from your RRSP through the HBP when purchasing your first home. This could potentially give you up to an additional $80,000 towards your down payment on top of the funds used through your HBP.
Interested in how you can benefit from the Home Buyers’ Plan? Let’s talk! Stop by one of our locations or give us a call at 1.866.863.6237. We’re available 7 days a week to help you!