What is the Home Buyers’ Plan (HBP)?

THE Home Buyer plan (HBP) allows you to withdraw FROM your RRSP.

The HBP, or Home Buyers’ Plan, is a government program for first-time home buyers that allows individuals to withdraw funds from their Registered Retirement Savings Plan (RRSP) without facing immediate tax consequences. The Home Buyers’ Plan allows first-time home buyers to withdraw up to $35,000 from their RRSP tax-free as long as it’s paid back to their RRSP within 15 years with payments every year. This money must be used to purchase or build a qualifying home for themselves or a related person with a disability. The individual (or related person) must have a written agreement to buy or build the home before withdrawing from your RRSP.

If an individual chooses to withdraw funds under the HBP, they must repay the amounts on a non-deductible basis to an RRSP over a period of no more than 15 years. Repayment must begin in the second calendar year following the year of the withdrawal. Failure to repay any amount in a given year will result in that amount being included in the individual’s income for that year.

It’s worth noting that there is a special rule preventing individuals from receiving an RRSP deduction for contributions withdrawn under the HBP within 90 days of being made. Overall, the HBP can be a helpful option for those looking to purchase or build a home while utilizing their RRSP savings.

For official information about the Home Buyers’ Plan please click here.

If you’re looking for a comprehensive plan to purchase your first home please visit our Buyers page

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Mike Cook
Mike Cook
A blue-collar worker in a white-collar world, I spent most of my twenties building high-end homes, leading major renovations, restoring, and finding/fixing deficiencies in new construction. I am happy to use this experience to point out the potential of a home. I pride myself on always looking for a way of improving the experience for my clients, agents on my team, and my community through leadership, technology, and charity.

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