Amy opened an FHSA in June 2023. Amy's FHSA participation room for 2023 was $8,000 because this was the first year she opened an FHSA.

She read on the Canada Revenue Agency (CRA) web pages that she can transfer amounts directly from her RRSPs to her FHSAs.

In July 2023, Amy decided to transfer $5,000 from her RRSP to her FHSA. She filled out Form RC720, Transfer from your RRSP to your FHSA and brought it to her financial institution so that the amount would be transferred directly. The transfer was completed in the same month.

• Since it was a direct transfer and the transfer amount did not exceed Amy's unused FHSA participation room, there are no immediate tax consequences.
• Amy cannot claim an FHSA deduction on her 2023 income tax and benefit return for $5,000 because it is a direct transfer from her RRSP, which is not deductible.

K.G opened an FHSA in April 2023. K.G's FHSA participation room for 2023 was $8,000 because this was the first year he opened an FHSA.

In August 2023, K.G decided to move $6,000 from his RRSP to his FHSA. K.G did not fill out Form RC720, Transfer from your RRSP to your FHSA for a direct transfer. Instead, he made a $6,000 withdrawal from his RRSP and contributed the same amount to his FHSA on the same day.

• Since the transaction was not a direct transfer, the $6,000 that K.G withdrew from his RRSP would be treated as a normal RRSP withdrawal, and must be included as RRSP income on his 2023 income tax and benefit return.

The $6,000 would be treated as a contribution (not a transfer) to K.G's FHSA, which would reduce his unused FHSA participation room.

• K.G would be permitted to claim an FHSA deduction of up to $6,000 on his 2023 income tax and benefit return. For more information on FHSA deductions, go to Tax deductions for FHSA contributions.

On October 20, 2023, Mikaela opened an FHSA. Mikaela's FHSA participation room was $8,000 because this was the first year she opened an FHSA.

Mikaela fills out Form RC720, Transfer from your RRSP to your FHSA to complete a direct transfer from her RRSP to her FHSA and gives it to her RRSP issuer.

On November 1, 2023, Mikaela completes a direct transfer of $5,000 from her RRSP, which has a balance of $15,000, to her FHSA. Mikaela's FHSA balance is now $5,000 and her RRSP balance is now $10,000.

Since it is a direct transfer and the transfer amount did not exceed Mikaela's unused FHSA participation room, there are no immediate tax consequences.

• Mikaela cannot claim an FHSA deduction on her 2023 income tax and benefit return, because it is a direct transfer from her RRSP, which is not deductible.

Mikaela's unused FHSA participation room after the transfer is $3,000.

• plus $8,000 (FHSA participation room for 2023)
• –minus $5,000 (direct transfer from her RRSP)
• =equals $3,000 (unused FHSA participation room for 2023)

Cheska opened an FHSA in April 2023. Cheska's FHSA participation room for 2023 was $8,000 because this was the first year she opened an FHSA.

Cheska read on the CRA web pages that individuals can directly transfer property from their RRSPs to their FHSAs, as long as it does not exceed their unused FHSA participation room at the time of the transfer.

• Cheska did not fill out Form RC720, Transfer from your RRSP to your FHSA to complete a direct transfer from her RRSP to her FHSA.

Instead, Cheska withdrew $8,000 from her RRSP in August 2023, and contributed $8,000 to her FHSA on the same day. Cheska did not make any other contributions or transfers to her FHSA for the rest of the year.

Since Cheska did not complete a direct transfer, the $8,000 that she withdrew from her RRSP is treated as a taxable withdrawal, which must be included as income on her income tax and benefit return for 2023. The $8,000 is also treated as a contribution to Cheska's FHSA in August 2023.

Cheska reported $8,000 as RRSP income, and claimed the maximum FHSA deduction of $8,000 when she filed her income tax and benefit return for 2023.

Hanif contributed $5,000 to Sanjida's RRSP as a spousal RRSP contribution in April 2020.

In June 2023, Sanjida decides to open an FHSA. She wants to maximize her FHSA on that same day. Sanjida's FHSA participation room for 2023 is $8,000 because this is the first year she opens an FHSA. Sanjida decides to contribute $3,000 to her FHSA and fills out Form RC720, Transfer from your RRSP to your FHSA to directly transfer $5,000 from her spousal RRSP to her FHSA. Since the spousal RRSP contributions were made in 2020, Sanjida can transfer the amount from her spousal RRSP into her FHSA with no immediate tax consequences.

Saul contributes $5,000 to Carla's spousal RRSP in April 2023.

In June 2023, Carla decides to open an FHSA. She wants to maximize her FHSA on that same day. Carla's FHSA participation room for 2023 is $8,000 because this is the first year she opens an FHSA. Carla would like to contribute $3,000 and directly transfer $5,000 from her spousal RRSP to her FHSA. Carla would be able to contribute $3,000 to her FHSA, but in order to avoid unintended tax consequences, she has to wait until at least January 1, 2026, to make a transfer from her spousal RRSP.

Patrick opened an FHSA in April 2023. Patrick's FHSA participation room for 2023 was $8,000 because this was the first year he opened an FHSA.

On May 5, 2023, Patrick contributed $8,000 to his FHSA in Bank A, reducing his unused FHSA participation room to zero. Patrick did not make any other contributions to his FHSAs or transfers from his RRSPs to his FHSAs for the rest of the year.

In July 2023, he received his FHSA statement from Bank A, which showed that there was only minimal growth of $25 in his FHSA. Patrick decided to talk to other financial institutions to see if they could offer a better rate of return for his FHSA investment. Patrick found a better rate offered at another financial institution and decided to transfer the property from his FHSA with Bank A to an FHSA he opened with Bank B.

For Patrick's FHSA transfer to have no tax consequences:

• Bank A must complete a direct transfer of the property to Bank B
• Patrick must not withdraw the property himself, but must fill out Form RC721, Transfer from your FHSA to your FHSA, RRSP or RRIF and bring it to his financial institution in order to complete the direct transfer

Lito opened FHSAs with Bank A and Bank B in April 2023. Lito's FHSA participation room for 2023 was $8,000 because this was the first year he opened an FHSA.

When he opened the FHSAs, Lito contributed $2,000 to his FHSA with Bank A, and $1,000 to his FHSA with Bank B. In June 2023, Bank B offered Lito a higher interest rate on his FHSA investments.

Lito decided that it would be better if he moved all of the property from his FHSA with Bank A to his FHSA with Bank B. As of June 2023, the fair market value (FMV) of Lito's FHSA with Bank A increased to $2,100.

• Lito did not fill out the transfer form to do a direct transfer.

Instead, he withdrew $2,100 from his FHSA with Bank A in June 2023 and contributed the same amount to his FHSA with Bank B in July 2023. He did not make any other contributions or transfers to either of his FHSAs for the rest of the year.

Since it was not a direct transfer between Lito's FHSAs, the $2,100 that he withdrew from his FHSA with Bank A would be a taxable withdrawal. Lito must report $2,100 as income when he files his 2023 income tax and benefit return.

Likewise, the $2,100 will also be treated as a new contribution to Lito's FHSA with Bank B in July 2023, which will reduce his unused FHSA participation room.

At the end of 2023, Lito would have used up $5,100 of his FHSA participation room for the year.

• plus $2,000 (FHSA contribution with Bank A in April 2023)
• +plus $1,000 (FHSA contribution with Bank B in April 2023)
• +plus $2,100 (FHSA contribution with Bank B in July 2023)
• =eqauls $5,100 (total FHSA participation room used for 2023)

• Lito would be permitted to claim an FHSA deduction of up to $5,100 on his 2023 income tax and benefit return. For more information on FHSA deductions, go to Tax deductions for FHSA contributions.

His unused FHSA participation room is $2,900.

• plus $8,000 (FHSA participation room for 2023)
• –minus $5,100 (FHSA contributions in 2023)
• =eqauls $2,900 (unused FHSA participation room for 2023)

Ty opened an FHSA in July 2023. Ty's FHSA participation room for 2023 was $8,000 because this was the first year he opened an FHSA.

Ty wanted to begin investing in his FHSA in 2023. However, due to his financial situation, he only had property available in his TFSA.

Ty decided to go to his financial institution and asked if he could transfer property from his TFSA to his FHSA, and if he could fill out a transfer form in order to do a direct transfer from his TFSA to his FHSA.

Ty's financial institution told him that he cannot make a direct transfer from his TFSA to his FHSA. If Ty wants to move property from his TFSA to his FHSA, he would have to make a withdrawal from his TFSA and then make a contribution to his FHSA. These transactions would be treated as a withdrawal from his TFSA and as a new contribution to his FHSA. The amount that Ty withdraws from his TFSA will be added back to his TFSA contribution room at the beginning of the following year, while the amount that he contributes to his FHSA will reduce his unused FHSA participation room.

On August 27, 2023, Ty withdrew $5,000 from his TFSA and contributed the same amount to his FHSA on the same day. Ty did not make any other transactions to his FHSA for the remainder of the year.

The $5,000 that Ty withdrew from his TFSA was treated as a TFSA withdrawal on August 27, 2023. This withdrawal will be added back to his TFSA contribution room at the beginning of 2024.

Likewise, the $5,000 was treated as a new contribution to Ty's FHSA on August 27, 2023, which reduced his 2023 unused FHSA participation room.

At the end of 2023, Ty would have used up $5,000 of his FHSA participation room for the year.

• Ty would be permitted to claim an FHSA deduction of up to $5,000 on his 2023 income tax and benefit return. For more information on FHSA deductions, go to Tax deductions for FHSA contributions.

His unused FHSA participation room is $3,000.

• plus $8,000 (FHSA participation room for 2023)
• –minus $5,000 (FHSA contributions in 2023)
• =eqauls $3,000 (unused FHSA participation room for 2023)