Tax Tip - Ten tips if you opened a First Home Savings Account in 2023

OTTAWA, ON, March 6, 2024 /CNW/ - Did you open a First Home Savings Account (FHSA) in 2023? 

If so, you need to be aware of this important information.

1. File your income tax and benefit return and fill out Schedule 15, FHSA Contributions, Transfers and Activities, to let us know that you opened an account, even if you did not contribute to your FHSA or transfer from your RRSP to your FHSA in 2023.
   
   
2. Up to $8,000 in FHSA contributions made by December 31, 2023, can be claimed as a deduction on your 2023 income tax and benefit return.
   
   
3. Contributions made to your FHSA are generally tax-deductible, while transfers from your RRSPs to your FHSAs are not tax-deductible.
   
   
4. Your FHSA issuer will give you a T4FHSA slip, First Home Savings Account Statement, showing the totals of certain transactions you made in your FHSA in 2023.
   
   
5. You can open more than one FHSA, but the total amount contributed or transferred to all of your FHSAs should not exceed the annual and lifetime limits.
   
   
6. Unused FHSA contributions (contributions that are not deducted in the year they are made) can generally be carried forward for future tax years.
   
   
7. Qualifying withdrawals, including investment income earned in your FHSA on contributions and transfers, are non-taxable when withdrawn to build or buy a qualifying home.
   
   
8. You can withdraw from your FHSA and your RRSP under the Home Buyers' Plan for the same qualifying home, as long as you meet all of the conditions at the time of each withdrawal.
   
   
9. Your FHSA participation details can be accessed through My Account. You can also view and print a copy of your T4FHSA slip.
   
   
10. Once your 2023 income tax and benefit return has been assessed, you will receive an FHSA participation room statement with your notice of assessment or on a T1028.

Try the new estimator tool
Looking to get an idea of how much you could save for a down payment for your first home? Check out the FHSA estimator. It has built-in limits to reflect the annual limit of $8,000 and the $40,000 lifetime limit. Based on your approximate yearly taxable income and province or territory of residence, you can also estimate your potential tax savings, including investment growth, on the contributions and transfers you make to your FHSAs.

Need more information?
To learn more, visit the First Home Savings Account (FHSA) web pages.

Contacts

Media Relations
Canada Revenue Agency
613-948-8366
[email protected]

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SOURCE Canada Revenue Agency