---
title: RRSP Home Buyers’ Plan (HBP) in Canada
description: Discover how the RRSP Home Buyers’ Plan helps first-time home buyers in Canada withdraw up to $60,000 from their RRSP, tax-free, to fund their home purchase.
---

[Toro Accounting Blog](https://toroaccounting.ca/blog)

# [RRSP Home Buyers’ Plan (HBP) in Canada](https://toroaccounting.ca/blog/rrsp-home-buyers-plan)

 Written by [Camilo Toro](https://toroaccounting.ca/blog/author/camilo-toro) | Feb 17, 2026 10:26:33 PM

Buying your first home is exciting — but coming up with the down payment can feel overwhelming.

The **RRSP Home Buyers’ Plan (HBP)** is a government program that allows eligible Canadians to withdraw funds from their **Registered Retirement Savings Plan (RRSP)** to buy or build a qualifying home — **tax-free**.

Let’s break down how it works.

## 🔹 What Is the RRSP Home Buyers’ Plan?

The **Home Buyers' Plan (HBP)** allows you to withdraw up to:

- **$60,000 per person** (current limit)
- **$120,000 per couple**, if both qualify

The withdrawal is **not taxed**, as long as you repay the amount back into your RRSP over time.

This program is administered by the Canada Revenue Agency (CRA).

## 👤 Who Qualifies?

You may qualify if:

- You are considered a **first-time home buyer**
- You have a written agreement to buy or build a qualifying home
- You intend to live in the home as your principal residence
- You are a resident of Canada at the time of withdrawal
- You have not owned and occupied a home in the previous **four years**

💡 **Important:** The “first-time home buyer” rule includes a four-year lookback period — meaning you may qualify again even if you owned a home in the past.

There are also special rules for:

- Individuals with disabilities
- Helping a related person with a disability buy a home

## 💰 How Much Can You Withdraw?

- Up to **$60,000 per individual**
- Withdrawals must come from your RRSP (not TFSA)
- Funds must have been in your RRSP for at least **90 days** before withdrawal

You must complete **Form T1036** through your financial institution to make the withdrawal.

## 📅 How Does Repayment Work?

The HBP is **not free money** — it is a loan from yourself.

You must repay the amount:

- Over **15 years**
- Starting in the **second year after withdrawal**

Each year, you must repay at least **1/15th** of the total withdrawn.

Example:

If you withdraw **$30,000**, you must repay:

- $2,000 per year for 15 years

If you do not repay the required amount in a given year:

- That portion is added to your taxable income for that year.

## 🧮 Example Scenario

Maria withdraws **$40,000** from her RRSP in 2025 to purchase her first home.

- She does not repay anything in 2025 or 2026.
- Her first repayment is due in **2027**.
- She must repay at least **$2,667 per year** ($40,000 ÷ 15).

If she only repays $1,000 in 2027:

- The remaining $1,667 is added to her taxable income.

## ⚖ Pros and Cons of the HBP

### ✅ Advantages

- Helps increase your down payment
- Reduces mortgage insurance costs
- No tax withheld on withdrawal
- Flexible repayment timeline (15 years)

### ⚠ Considerations

- You lose investment growth inside your RRSP during withdrawal
- Missed repayments become taxable income
- It may impact your long-term retirement savings

## 🔍 Is It the Right Move for You?

The HBP can be a powerful tool — but it’s not always the best option for everyone.

You should consider:

- Your long-term retirement goals
- Your current income level
- Whether you plan to make consistent RRSP contributions
- Mortgage affordability

Sometimes, using the HBP makes sense. Other times, it may be better to preserve your RRSP and explore other savings strategies.

## 📌 Final Thoughts

The RRSP Home Buyers’ Plan is designed to make home ownership more accessible — especially for first-time buyers.

But like any financial decision, it should be part of a broader plan that balances home ownership with retirement security.

If you're considering using the HBP, professional guidance can help you:

- Understand repayment obligations
- Estimate tax implications
- Structure contributions strategically

[View full post](https://toroaccounting.ca/blog/rrsp-home-buyers-plan)

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