I am a Canadian Resident Tax Payer.

  • I regularly max out on my RRSP contribution room.
  • I never owned a home, I have been renting because I move around a lot because of work (Canada & USA).
  • I am interested in opening the new FHSA account that would help reduce my taxable income or I could use it to buy my first home if I find a suitable property.

My question

If I open the FHSA account and I am not able to buy a house in the 15 years time period. When I convert the FHSA to an RRSP will there be any penalty involved because I am regularly maxing out my RRSP contributions and there will not be any room left to accommodate any new contributions.

Can someone comment on how this works.

  • I would not count on the rules regarding transfers between a FHSA to a RRSP being the same 15 years from now. Note you also lose out on the biggest benefit : qualifying withdrawals do not count as income. Once transferred to a RRSP any money coming out is counted as income. Might be better off just using a TFSA depending on tax bracket in retirement.
    – Brian
    Commented Apr 17, 2023 at 18:43

1 Answer 1


It’s a no-brainer to open an FHSA. You’ll get a tax deduction for the amount contributed. $8K max per year, up to a max of $40,000, but only if you opened the FHSA in 2023. If you didn't open the FHSA in 2023, your max contribution is now reduced to $32000 ($8000 x 4). And you have 15 years to decide, use the money to purchase a house (tax free), or transfer it to your RRSP (and pay later as income). The transfer to your RRSP does not impact your RRSP contribution room.


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