First-time buyer programs, used together

The Canadian and Ontario governments offer four major programs specifically designed for first-time buyers, and the trick most people miss is that you can use them together. The FHSA, the RRSP Home Buyers' Plan, the Land Transfer Tax rebate, and the First-Time Home Buyer's Tax Credit are not either-or choices. I run through all four with every first-time client — the combined benefit usually runs $30K to $50K depending on the purchase.

First Home Savings Account (FHSA)

The FHSA is the newest and most powerful first-time buyer program. Launched in 2023, it combines the best features of an RRSP and a TFSA:

• Contributions are tax-deductible (like an RRSP) — reducing your tax bill in the year you contribute
• Withdrawals for a home purchase are tax-free (like a TFSA) — with no requirement to pay it back
• Contribution limit: $8,000 per year, up to $40,000 lifetime
• Unused contribution room carries forward (up to $8,000)
• Account can stay open 15 years or until you turn 71, whichever comes first

RRSP Home Buyers' Plan (HBP)

The HBP lets you withdraw up to $60,000 from your RRSP to buy a qualifying first home, tax-free — but you have to pay it back within 15 years. Couples can each withdraw $60,000, for a combined $120,000.

Key points:

• Must be a first-time buyer (or haven't owned in 4 years)
• Funds must be in the RRSP at least 90 days before withdrawal
• Repayments start 2 years after the withdrawal, spread over 15 years
• Missed repayments are added to your taxable income for that year

FHSA vs. HBP — which should you use?

If you qualify for both, the FHSA is generally better because you don't have to pay it back. But there's no reason to choose — you can use both, stacking up to $100,000 ($40k FHSA + $60k HBP) from a single person, or $200,000 for a couple.

First-Time Home Buyer Tax Credit (HBTC)

A non-refundable federal tax credit of up to $1,500 (15% × $10,000). It's claimed on your tax return in the year you buy. Simple to claim, just make sure your accountant knows you bought.

Ontario Land Transfer Tax Rebate

First-time buyers in Ontario get up to $4,000 refunded from their provincial land transfer tax. On top of that, first-time buyers in Toronto get up to $4,475 refunded from the municipal land transfer tax — so up to $8,475 in total rebates if you're buying in Toronto.

GST/HST New Housing Rebate

Buying a new-build (new construction, not resale)? You may be eligible for a partial GST/HST rebate, which reduces the tax you pay on the purchase price. Your lawyer handles this at closing.

First-Time Home Buyer Incentive (FTHBI)

Note: The federal FTHBI shared-equity program ended in March 2024. It's no longer accepting new applications. If someone references it as currently available, their information is out of date.

Stacking it all together

A typical first-time buyer in Toronto might use:

• FHSA: $40,000 tax-free toward down payment
• RRSP HBP: $40,000-$60,000 as additional down payment
• LTT Rebate (Ontario + Toronto): $8,475
• HBTC: $1,500 tax credit

That's roughly $100,000 in down payment ammunition plus $10,000 in rebates and credits — all just for being a first-time buyer.

Who qualifies as a "first-time buyer"?

Definitions vary slightly by program, but generally:

• FHSA: You (and your spouse/common-law partner) haven't owned a home that was your principal residence in the current year or the previous 4 calendar years.
• HBP: Same 4-year rule.
• Ontario LTT rebate: You've never owned a home anywhere in the world. Your spouse's ownership history counts against you if you were married/common-law when they owned.

Frequently Asked Questions

Use every program you qualify for

Most first-time buyers leave thousands of dollars on the table because nobody mapped the programs for them. Send me a note with your situation and I'll show you exactly which ones apply to you, in what order, and how much each is worth in your specific case.