Beginning in 2023, prospective first-time homebuyers can save up to $8,000 per year for 5 years. That’s a total of $40,000 per person or $80,000 per couple that can go toward a new home purchase. And this savings vehicle is the only truly tax-free incentive available in Canada.

The money is not taxable income when it is earned (it’s tax-deductible), nor is it taxable when it is withdrawn. Income earned on the savings is also not taxable. Like all primary residences, the proceeds from the sale of the home purchased with the FHSA funds is also not subject to any tax (capital gains or income tax).

All in all, this program will offer a significant tax advantage to first-time buyers.

If you or someone you know is a first-time home buyer preparing to buy now or sometime down the road, it’s never too early to have a chat. Send me an email and let’s connect.