The RRSP Home Buyers’ Plan (HBP) lets first-time buyers take up to $60,000 out of their RRSP to buy a home, without paying tax on the withdrawal. For a couple, that is up to $120,000. However, it is a loan to yourself, so you must pay it back, and the rules have changed several times since 2024.
So this guide explains how the Home Buyers’ Plan works in 2026, who qualifies, how repayment works and when it makes sense to use it.
How the Home Buyers’ Plan works
Normally, an RRSP withdrawal is taxed as income, so your bank also withholds tax right away. Under the HBP, however, no tax is withheld, and the money is not added to your income as long as you repay it on schedule.
The $60,000 limit applies to withdrawals made after April 16, 2024. Previously, the limit was $35,000. In addition, you can combine the HBP with an FHSA for the same home, according to the Canada Revenue Agency.
Who qualifies for the Home Buyers’ Plan?
To use the HBP, you generally must:
- Be a first-time home buyer. In other words, you did not live in a home that you or your spouse owned during the four-year period before the withdrawal.
- Be a resident of Canada.
- Have a written agreement to buy or build a qualifying home.
- Intend to live in the home as your principal residence within one year of buying or building it.
- Buy or build the home before October 1 of the year after your withdrawal.
Home Buyers’ Plan repayment rules for 2026
However, repayment is where most people get confused. Normally, you repay 1/15 of the amount each year, starting in the second year after the withdrawal. However, the government has temporarily deferred the start date. For first withdrawals made between January 1, 2026 and December 31, 2028, repayments start in the fifth year after the year of the withdrawal.
Example: a $60,000 withdrawal in 2026
- 2026
Withdraw $60,000
File Form T1036 with your RRSP provider, then use the money toward your down payment.
- Before Oct 1, 2027
Buy or build the home
You must complete the purchase or construction by this deadline.
- 2031
First repayment due
Then you repay at least $4,000, which is 1/15 of the balance.
- 2031 to 2045
Keep repaying yearly
Each year, repay the minimum or more. You can also repay faster at any time.
When you miss a required repayment, the shortfall is added to your taxable income for that year. So it is smart to set up automatic RRSP contributions well before your first repayment is due.
Home Buyers’ Plan vs. a regular RRSP withdrawal
The tax difference is dramatic. For example, if you took $30,000 out of your RRSP without the HBP, your bank would withhold 30%, or $9,000, outside Quebec. Then the full $30,000 would be added to your income at tax time.
Tax withheld on a $30,000 RRSP withdrawal
Is it a good idea to use your RRSP to buy a house?
Often, yes, but there are trade-offs. On the plus side, the HBP can help you reach 20% down and avoid CMHC insurance, or at least move into a lower premium tier. It also helps you meet the minimum down payment sooner.
Pros and cons of the HBP
Pros
- Tax-free access to up to $60,000
- Can be combined with the FHSA
- Repayments start years later
- Repaying rebuilds your retirement savings
Cons
- Your RRSP stops growing on that money
- Repayments compete with mortgage costs
- Missed payments become taxable income
- Only available to first-time buyers
Meanwhile, the FHSA has no repayment at all. So many buyers use their FHSA first, and then top up with the HBP when they still need more.
How to use the Home Buyers’ Plan, step by step
Using the HBP
Check your RRSP balance
First, make sure contributions have been in the account for at least 90 days.
Sign a purchase agreement
Before you withdraw, you need a written agreement to buy or build a qualifying home.
Complete Form T1036
Then submit it to your RRSP provider for each withdrawal.
Track your repayments
Your notice of assessment shows your annual HBP balance and minimum repayment.
Frequently asked questions
You can withdraw up to $60,000 from your RRSPs for withdrawals made after April 16, 2024. A couple buying together can therefore withdraw up to $120,000.
Normally, repayments start in the second year after the withdrawal. However, for first withdrawals made from 2026 to 2028, repayments start in the fifth year after the withdrawal and continue for 15 years.
Outside the HBP, your bank withholds 30%, or $9,000, outside Quebec, and the full amount is added to your taxable income. Under the HBP, no tax is withheld as long as you repay on schedule.
Yes. You can use both for the same qualifying home, so a first-time buyer could access up to $100,000 from the two accounts combined.
Sources: CRA: Home Buyers’ Plan · CRA: First Home Savings Account · FCAC: Getting preapproved