Withdrawals and transfers out of your FHSAs

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Withdrawals and transfers out of your FHSAs

You may want to take property out of your first home savings account (FHSA) to buy your first home, or for another purpose. You may want to transfer property from your FHSA to your registered retirement savings plan (RRSP), registered retirement income fund (RRIF), or other FHSAs. Depending on the circumstances, you may or may not need to pay taxes on your withdrawals or transfers.

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Withdrawals from your FHSAs without tax consequences

A withdrawal from an FHSA is not required to be included in your income if it is:

When your withdrawal is not a qualifying withdrawal, designated amount, or an amount otherwise included in your income, it is a taxable withdrawal. A taxable withdrawal must be included as income on your income tax and benefit return.

Making qualifying withdrawals from your FHSAs

If you meet all of the qualifying withdrawal conditions, you can withdraw all of the property from your FHSAs tax-free. You can do this either in a single withdrawal or a series of withdrawals.

There is no minimum number of days that contributions or transfers to your FHSAs must stay in your FHSAs before you can use them as a qualifying withdrawal.

You do not need to repay the qualifying withdrawals that you make from your FHSAs.

If you are buying or building a qualifying home together with another individual, both of you can make a qualifying withdrawal from your own FHSAs as long as you both meet all of the conditions to make a qualifying withdrawal.

A qualifying withdrawal is a withdrawal from your FHSA where all of the following conditions are met:


  • You must be a first-time home buyer for the purposes of making a withdrawal
    This means you did not live in a qualifying home (or what would be a qualifying home if located in Canada) as your principal place of residence that you owned or jointly owned at any time in the current calendar year before the withdrawal (except the 30 days immediately before the withdrawal) or the previous 4 calendar years

    A "first-time home buyer" for the purpose of making a qualifying withdrawal is different than a "first-time home buyer" for the purpose of opening an FHSA.

  • You must have a written agreement to buy or build a qualifying home with the acquisition or construction completion date of the qualifying home before October 1 of the year following the date of the withdrawal What counts as a qualifying home

    A qualifying home is a housing unit located in Canada. This includes existing homes and those being constructed.

    Qualifies

    • Single-family homes
    • Semi-detached homes
    • Townhouses
    • Mobile homes
    • Condominium units
    • Apartments in duplexes, triplexes, fourplexes, or apartment buildings
    • A share in a co-operative housing corporation that entitles you to own and gives you an equity interest in a housing unit

    Does not qualify

    • A share that only provides you with a right to tenancy in the housing unit

  • You must not have acquired the qualifying home more than 30 days before making the withdrawal
  • You must be a resident of Canada from the time that you make your first qualifying withdrawal from one of your FHSAs until the earlier of the acquisition of the qualifying home, or the date of your death
  • You must occupy or intend to occupy the qualifying home as your principal place of residence within one year after buying or building it
  • You must fill out Form RC725 Request to Make a Qualifying Withdrawal from your FHSA and give it to your FHSA issuer

You need to meet all of the above conditions to make a qualifying withdrawal

If you do not meet all of the conditions above, the amount withdrawn from your FHSA may be a taxable withdrawal. You must include the amount you withdraw as income on your income tax and benefit return for the year the withdrawal is received.

You are responsible for making sure that all of the conditions to make a qualifying withdrawal are met. If you make a qualifying withdrawal and a condition is not met at the time of the withdrawal, your withdrawal will be treated as a taxable withdrawal. You must include all of the withdrawal as income on your income tax and benefit return for the year you received the property. If the CRA has already assessed your income tax and benefit return for that year, the CRA will reassess it to include the taxable withdrawal in your income.

You can withdraw amounts from your RRSPs under the Home Buyers’ Plan (HBP) and make a qualifying withdrawal from your FHSAs for the same qualifying home, as long as you meet all of the conditions at the time of each withdrawal. For information about the HBP conditions, go to How to participate in the Home Buyers’ Plan (HBP).

Unlike the HBP, once you have made a qualifying withdrawal from your FHSAs, you cannot cancel it. If you recontribute the amount of your qualifying withdrawal to your FHSAs, it will be counted as a new contribution to your FHSAs.

  • Example: Making a qualifying withdrawal

    Bruno, a resident of Canada, opened his FHSA in April 2023 and made a yearly contribution of $8,000 to his account. He has never owned a house.

    Bruno signed a written purchase agreement on May 15, 2025 to buy a qualifying home. The written purchase agreement stated that the possession date of the house would be January 8, 2026.

    On July 4, 2025, Bruno filled out Form RC725, Request to Make a Qualifying Withdrawal from your FHSA to make a qualifying withdrawal from his FHSA. He wanted to withdraw all the remaining property from his FHSA. He went to his financial institution and gave them the form to process the withdrawal. The withdrawal was completed on July 5, 2025.

    Bruno continued to be a resident of Canada and acquired the house on January 8, 2026. Bruno started living in the house as his principal place of residence on February 1, 2026.

    Since Bruno met all of the conditions to make a qualifying withdrawal from his FHSA, his withdrawal was not required to be included in income for his 2025 income tax and benefit return.

  • Example: Making a qualifying withdrawal with your spouse or common-law partner

    Kara and Stephen were common-law partners who were both residents of Canada. Both of them have never owned a home.

    Kara and Stephen each opened their own FHSAs on October 2, 2023.

    Kara contributed $8,000 to her FHSA on October 2, 2023. Stephen transferred $5,000 from his RRSP to his FHSA on October 3, 2023.

    Kara and Stephen signed a written purchase agreement on October 16, 2023 to jointly buy a qualifying home. The written purchase agreement stated that both Kara and Stephen will be the owners of the house, and that the possession date of the house would be November 30, 2023.

    Kara and Stephen went to their financial institution and asked if they could both make a qualifying withdrawal from their own FHSAs in order to buy the same qualifying home. Kara and Stephen’s financial institution told them that they can each make a qualifying withdrawal from their own FHSAs in order to buy the same qualifying home, provided that they both meet all of the conditions required to make the qualifying withdrawal.

    On November 1, 2023, Kara and Stephen each filled out Form RC725, Request to Make a Qualifying Withdrawal from your FHSA and gave the forms to their financial institution. Both withdrawals were completed on the same day.

    Kara and Stephen both continued to be residents of Canada and acquired the house on November 30, 2023. They both started living in the house as their principal place of residence on the same day.

    Since both Kara and Stephen met all of the conditions to make a qualifying withdrawal from their own FHSAs, their withdrawals were not required to be included in income for their 2023 income tax and benefit return.

  • Example: Making a qualifying withdrawal if your spouse or common-law partner is not a first-time home buyer

    Joshua, a resident of Canada, opened an FHSA in April 2023 and contributed $8,000 in the same month. He has never owned a home.

    In May 2023, Joshua married Lisa. Joshua moved in with Lisa and started to live in a condominium unit that Lisa owned as her principal place of residence since 2020. Joshua never owned the condominium unit that he lived in with Lisa.

    Joshua signed a purchase agreement on July 3, 2023 to jointly buy a qualifying home with Lisa. The written purchase agreement stated that both Joshua and Lisa will be the owners of the house, and that the possession date of the house will be on July 31, 2023.

    Joshua and Lisa were living in the condominium unit that Lisa owned as their principal place of residence at the time they signed the written purchase agreement.

    Joshua met all of the conditions to make a qualifying withdrawal from his FHSA, including being a first-time home buyer for the purpose of making a qualifying withdrawal. The fact that Joshua lived in a condominium unit that his wife owns as her principal place of residence is not relevant in determining whether Joshua can make a qualifying withdrawal.

    On July 15, 2023, Joshua filled out Form RC725, Request to Make a Qualifying Withdrawal from your FHSA and gave it to his financial institution. The withdrawal of $8,000 was completed on the same day.

    Joshua continued to be a resident of Canada. Joshua and Lisa took possession of the house on July 31, 2023 and started to live in the house as their principal place of residence on the same day.

    Since Joshua met all of the conditions to make a qualifying withdrawal from his FHSA, his withdrawal was not required to be included in income for his 2023 income tax and benefit return.

  • Example: Making a qualifying withdrawal to buy a qualifying home with someone who is not a first-time home buyer

    Machi, a resident of Canada, opened her FHSA in July 2023 and contributed $8,000 in the same month. She has never owned a home.

    Machi signed a written purchase agreement on August 5, 2023 to jointly buy a qualifying home with her mother. The written purchase agreement stated that both Machi and her mother will be the owners of the house, and that the possession date of the house would be October 15, 2023.

    Machi’s mother was living in a house that she owned as her principal place of residence at the time they signed the written purchase agreement.

    Machi met all of the conditions to make a qualifying withdrawal from her FHSA, including being a first-time home buyer for the purposes of making a qualifying withdrawal. The fact that Machi’s mother recently owned another home is not relevant in determining whether Machi can make a qualifying withdrawal.

    On August 29, 2023, Machi filled out Form RC725, Request to Make a Qualifying Withdrawal from your FHSA and gave it to her financial institution. The withdrawal of $8,020 was completed on August 30, 2023.

    Machi continued to be a resident of Canada. Machi and her mother took possession of the house on October 15, 2023 and started to live in the house as their principal place of residence on the same day.

    Since Machi met all of the conditions to make a qualifying withdrawal from her FHSA, her withdrawal was not required to be included in income for her 2023 income tax and benefit return.

Closing your FHSAs after making a qualifying withdrawal

You should close all of your FHSAs on or before December 31 of the year following the year of your first qualifying withdrawal. This is because your maximum participation period ends at the end of the year following the year of your first qualifying withdrawal. For more information, go to When to close an FHSA.

  • Example: Closing an FHSA after making a qualifying withdrawal

    Donna Mae opened her first and only FHSA in August 2023. She made yearly contributions of $5,000 to her FHSA and did not exceed her FHSA participation room for any year. She has been renting an apartment and has not occupied a property that she owned in the last six years.

    On November 5, 2028, Donna Mae signed a written purchase agreement to buy a qualifying home. The purchase agreement stated that the closing date of the property will be March 15, 2029. She continued to live in a rental apartment since she opened her FHSA in 2023.

    On January 11, 2029, Donna Mae went to her financial institution to make a withdrawal from her FHSA. She filled out Form RC725, Request to Make a Qualifying Withdrawal from your FHSA and asked to withdraw the full amount of her FHSA, which was $33,000, for the purpose of buying a qualifying home. Donna Mae did not make any other contributions or transfers to her FHSA after January 11, 2029.

    The financial institution issued the qualifying withdrawal of $33,000 to Donna Mae on January 12, 2029. She acquired the house on March 15, 2029, and started living in it on the same day.

    Donna Mae went back to her financial institution and closed her FHSA on December 16, 2030. Before she closed the account, its fair market value (FMV) was $0.

Making designated withdrawals from your FHSAs

If you contribute or transfer to your FHSAs more than your FHSA participation room for the year, you will have an excess FHSA amount . Generally, you have to pay a tax equal to 1% of the highest excess FHSA amount in the month, for each month that the excess remains in the account.

When you have an excess FHSA amount, you will continue to pay the monthly 1% tax until the excess FHSA amount is eliminated.

If you have an excess FHSA amount, one of the ways that you may be able to reduce or eliminate it is to make a designated withdrawal. The amount of the designated withdrawal is not required to be included as income on your income tax and benefit return in the year. For more information, go to What happens if you contribute or transfer too much to your FHSAs.

Making taxable withdrawals from your FHSAs

A withdrawal from your FHSA is not required to be included in your income if it is a qualifying withdrawal, a designated amount, or an amount otherwise included in your income.

In all other cases, an amount withdrawn from your FHSAs must be included as income on your income tax and benefit return for the year the withdrawal is received. This amount will be subject to income tax withholding, which can be claimed on your income tax and benefit return as a credit towards any tax owing for the year of the withdrawal.

If you have an excess FHSA amount, one of the ways that you can reduce or eliminate it is to make a taxable withdrawal. For more information, go to What happens if you contribute or transfer too much to your FHSAs.

  • Example: Making a taxable withdrawal

    Billy had $8,000 in his FHSA on July 3, 2023. On the same day, Billy withdrew $6,000 from his FHSA to buy a car. Since the amount withdrawn from Billy’s FHSA was not a qualifying withdrawal, a designated amount, or an amount otherwise included in his income, the amount that Billy withdrew is a taxable withdrawal.

    Billy must report the withdrawal of $6,000 as income on his 2023 income tax and benefit return. Billy can claim the tax that his financial institution withheld from his taxable withdrawal as a credit towards any tax owing for the year of the withdrawal.

Transfers out of your FHSAs without immediate tax consequences

Generally, you can transfer property out of your FHSAs without any immediate tax consequences if it is:

A direct transfer is a transfer completed directly between the financial institutions of the two plans or accounts involved.

In order to make a direct transfer, you must not withdraw the property yourself and contribute it to another one of your plans or accounts. Those transactions would not be considered a direct transfer. In that case, the amount that you withdraw from your FHSA will be a taxable withdrawal, which you must report as income when you file your income tax and benefit return for the year of the withdrawal. There may also be other unintended tax consequences for your other plans and accounts.

Transfers from your FHSAs to your RRSPs or RRIFs

You will be allowed to transfer property from your FHSAs to your RRSPs or RRIFs without any immediate tax consequences, as long as it is a direct transfer and you do not have an excess FHSA amount.

You can only directly transfer property from your FHSAs to your RRSPs or RRIFs under which you are the annuitant of the plan or fund.

Generally, an amount that is transferred directly from your FHSAs to your RRSPs or RRIFs will not impact your unused RRSP deduction room or your unused FHSA participation room.

If you do not do a direct transfer, the amount you withdraw from your FHSAs would be a taxable withdrawal and would be treated as a new RRSP contribution. That new contribution would reduce your unused RRSP deduction room and could result in RRSP excess contributions in certain cases.

To complete a direct transfer from your FHSAs to your RRSPs or RRIFs, fill out Form RC721, Transfer from your FHSA to your FHSA, RRSP or RRIF and give it to your financial institution.

Financial institutions do not have to use Form RC721. The institution that transfers your amounts may use other types of documents to record the transfer. The institution has to provide you with confirmation of the details of the transfer.


  • Example: Transfer from an FHSA to an RRSP – Amounts transferred directly

    Anthony opened his FHSA in 2023. Over the years, he contributed the maximum amount to his FHSA, reaching his lifetime FHSA limit of $40,000 in 2027. It is now 2038, and Anthony must close his account by December 31, 2038, since it will reach the maximum participation period of fifteen years on that date. Anthony does not have an excess FHSA amount.

    Anthony fills out Form RC721, Transfer from your FHSA to your FHSA, RRSP or RRIF and asks his financial institution to do a direct transfer of all of the property in his FHSA to his RRSP and to close his FHSA once the property has been transferred.

    • Since it is direct transfer and Anthony has no excess FHSA amount, there are no tax consequences and there will be no impact on his unused RRSP deduction room.

    After the transfer is completed on August 28, 2038, the property from Anthony’s FHSA that is now in his RRSP will be subject to the normal RRSP rules. If Anthony decides to withdraw amounts (which may include this amount) from his RRSP at a later date, the rules on withdrawing amounts from his RRSP will apply.

  • Example: Transfer from an FHSA to an RRSP – Amounts not transferred directly

    Sean opens an FHSA in April 2023 and makes a yearly $2,000 contribution to his account. Sean does not have an excess FHSA amount.

    In September 2030, the FMV of Sean’s FHSA is $20,000 and he decides to move $5,000 from his FHSA to his RRSP. Sean does not fill out Form RC721, Transfer from your FHSA to your FHSA, RRSP or RRIF to complete a direct transfer from his FHSA to his RRSP. Sean withdraws $5,000 from his FHSA and contributes the same amount to his RRSP on the same day.

    • Since it is not a direct transfer, the $5,000 that Sean withdraws from his FHSA would be a taxable withdrawal. Therefore, Sean must report this amount as income for the 2030 tax year when he files his income tax and benefit return.

    The $5,000 will also be treated as a new contribution to Sean’s RRSP, which will reduce his unused RRSP deduction room, and will be subject to the normal RRSP rules.

If you have an excess FHSA amount

If you have an excess FHSA amount at the time of the transfer from your FHSAs to your RRSPs or RRIFs, the maximum amount you can transfer and avoid tax consequences is the total fair market value (FMV) of all of the property in your FHSAs minus your excess FHSA amount.

  • plus Total FMV of all of the property in your FHSAs
  • –minus Your excess FHSA amount
  • =eqauls Maximum amount you can transfer and avoid tax consequences

Any portion of the amount you transfer that exceeds the total FMV of all of the property held in all of your FHSAs at the time of the transfer minus your excess FHSA amount at the time of the transfer will be treated as both:

  • a taxable withdrawal from your FHSA, which must be included as income on your income tax and benefit return for the year of the transfer
  • a new RRSP contribution at the time of the transfer to your RRSP or RRIF

Property transferred to an RRSP or RRIF from an FHSA will be subject to the usual rules applicable to RRSPs and RRIFs. When amounts are later withdrawn from the RRSPs or RRIFs, the amounts withdrawn must be included as income in the year received on your income tax and benefit return. For more information, go to Registered Retirement Savings Plan (RRSP) and Registered Retirement Income Fund (RRIF).

Example: Transfer from an FHSA to an RRSP if you have an excess FHSA amount

Wayne opened an FHSA on August 28, 2023. Wayne’s FHSA participation room for 2023 was $8,000 because this was the first year he opened an FHSA.

Wayne transferred $20,000 from his RRSP to his FHSA on August 30, 2023. He did not make any other contributions to his FHSA or transfers from his RRSP to his FHSA for the remainder of the year.

Wayne’s total transfers to his FHSA were more than his $8,000 FHSA participation room for 2023. This created an excess FHSA amount of $12,000.

  • plus $8,000 (FHSA participation room for 2023)
  • –minus $20,000 (Transfer on August 30, 2023)
  • =eqauls -$12,000 (A negative amount means you have an excess FHSA amount)

On October 8, 2023, Wayne decided to transfer $15,000 from his FHSA to his RRSP. He filled out Form RC721, Transfer from your FHSA to your FHSA, RRSP or RRIF in order to do a direct transfer from his FHSA to his RRSP and gave it to his financial institution.

Wayne’s financial institution reminded him that the maximum amount that he can transfer in order to avoid immediate tax consequences is the total FMV of all of the property in his FHSAs at the time of the transfer minus his excess FHSA amount.

Wayne was aware of the tax consequences and decided to proceed with the transfer of $15,000 on October 8, 2023. The FMV of his FHSA at the time of the transfer was $22,500.

The maximum amount Wayne can transfer from his FHSA to his RRSP without any immediate tax consequences is:

  • plus $22,500 (Total FMV of all of Wayne's FHSAs at the time of the transfer)
  • –minus $12,000 (Wayne's excess FHSA amount at the time of the transfer)
  • =eqauls $10,500 (Maximum amount that can be transferred without immediate tax consequences)

The remaining $4,500 ($15,000 transferred minus $10,500 maximum amount that can be transferred without immediate tax consequences) was considered as a taxable withdrawal from Wayne’s FHSA. The $4,500 was also treated as a new contribution to Wayne’s RRSP at the time of the transfer.

  • plus $15,000 (Property transferred from Wayne's FHSA to Wayne's RRSP)
  • –minus $10,500 (Maximum amount transferred without immediate tax consequences)
  • =eqauls $4,500 (Treated as both a taxable withdrawal from Wayne's FHSA and a new contribution to Wayne's RRSP)

Wayne reported the $4,500 taxable withdrawal as income when he filed his 2023 income tax and benefit return. He also reported $4,500 as an RRSP contribution when he filed his 2023 Schedule 7 - RRSP, PRPP and SPP Contributions and Transfers and HBP and LLP Activities.


Transfers from your FHSAs to another of your FHSAs

Generally, you can directly transfer property from one of your FHSAs to another of your FHSAs without reducing your FHSA participation room.

To complete a direct transfer between your FHSAs, fill out Form RC721 Transfer from your FHSA to your FHSA, RRSP or RRIF and give it to your financial institution.

Financial institutions do not have to use Form RC721. The institution that transfers your amounts may use other types of documents to record the transfer. The institution has to provide you with confirmation of the details of the transfer.

For more information on direct transfers between your FHSAs, go to Transfers between your FHSAs.

Making designated transfers out of your FHSAs

If you contribute or transfer to your FHSAs more than your FHSA participation room for the year, you will have an excess FHSA amount . Generally, you have to pay a tax equal to 1% of the highest excess FHSA amount in the month, for each month that the excess remains in the account.

When you have an excess FHSA amount, you will continue to pay the monthly 1% tax until the excess FHSA amount is eliminated.

If you have an excess FHSA amount, one of the ways that you may be able to reduce or eliminate your excess FHSA amount is to make a designated transfer . For more information, go to What happens if you contribute or transfer too much to your FHSAs.

Transfers out of your FHSAs to other registered plans

Direct transfers out of your FHSAs can only be made to your:

  • RRSPs
  • RRIFs
  • Other FHSAs

You cannot directly transfer property out of your FHSAs to any other registered plans including:

  • Tax Free Savings Account (TFSA)
  • Registered Pension Plans (RPP)
  • Registered Education Savings Plan (RESP)
  • Registered Disability Savings Plan (RDSP)
  • Pooled Registered Pension Plan (PRPP)
  • Specified Pension Plan (SPP)

Any property that you transfer out of your FHSAs to any other registered plan that is not an FHSA, RRSP, or RRIF will be treated as both:

  • A taxable withdrawal from your FHSAs
  • A new contribution to your registered plan

For more information on TFSAs, go to The Tax–Free Savings Account.

For more information on transfers between your other registered plans, go to T4040 RRSPs and Other Registered Plans for Retirement.

  • Example: Transferring property out of an FHSA to a TFSA

    Kaitlyn opens an FHSA in June 2023. Kaitlyn’s FHSA participation room for 2023 is $8,000 because this is the first year she opens an FHSA.

    On July 5, 2023, Kaitlyn contributes $8,000 to her FHSA.

    On September 30, 2023, Kaitlyn decides that she wants to transfer $3,000 from her FHSA to her TFSA. Kaitlyn goes to her financial institution and asks if she can do a direct transfer of $3,000 from her FHSA to her TFSA.

    Kaitlyn’s financial institution informs her that she cannot make a direct transfer from her FHSA to her TFSA. If Kaitlyn wants to transfer property from her FHSA to her TFSA, she would have to make a taxable withdrawal from her FHSA and then make a new contribution to her TFSA. The new contribution will reduce Kaitlyn’s TFSA contribution room for the year.

    On October 3, 2023, Kaitlyn withdraws $3,000 from her FHSA and contributes the same amount to her TFSA on the same day. The $3,000 is considered as both:

    • A taxable withdrawal from her FHSA
    • A new contribution to her TFSA

    Kaitlyn will receive a T4FHSA slip for 2023 showing the total of her contributions, taxable withdrawals, and income tax withholding for the year. She has to report these amounts on her 2023 income tax and benefit return.

Reporting withdrawals and transfers out of your FHSAs

Your FHSA issuer will give you a T4FHSA slip, First Home Savings Account Statement which will show:

  • the total of all qualifying withdrawals you made in the year in box 20
  • the total of all taxable withdrawals you made in the year in box 22
  • the total of all designated transfers you made in the year in box 36
  • the total of all designated withdrawals you made in the year in box 38

If you do not have an excess FHSA amount at the time of the transfer out of your FHSAs, you do not need to report the transfers out of your FHSAs into your RRSPs or RRIFs on your income tax and benefit return.

For more information on reporting your FHSA transactions and FHSA related activities to the CRA, go to Reporting FHSA activities on your income tax and benefit return.


Allowable FHSA deduction



Annual FHSA limit



Annuitant



Common-law partner



Designated amounts



Excess FHSA amount



Exempt period



Fair market value (FMV)



FHSA carryforward



FHSA deduction



FHSA participation room



First-time home buyer



Holder



Issuer



Lifetime FHSA limit



Maximum participation period



Non-qualified investment



Property



Qualified donee



Qualified investment



Qualifying home



Qualifying individual



Qualifying withdrawal



Registered retirement income fund (RRIF)



Registered retirement saving plan (RRSP)



Spouse



Successor holder



Survivor



Unused FHSA contributions



Unused FHSA participation room



Unused RRSP deduction room


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Date modified:
2023-12-19