April 1 marked the start of the Canadian government’s FIRST HOME SAVINGS ACCOUNT and it’s a really great option for aspiring homeowners to save for their downpayment. I really like that contributions are Tax deductible AND withdrawals are Tax free! If you’re saving anyway, why not grown your money and take advantage of the tax savings.
Here are some Key Points:
– You can contribute up to $8,000 annually and carry forward any unused portion to subsequent years.
– The lifetime limit for contributions is $40,000.
– Plus, if you don’t end up using the funds for a home purchase, you can transfer them to an RRSP or RRIF tax-free.
– As a first-time home buyer, you can also combine the FHSA with the HBP program on the same qualifying purchase.
And unlike the Home Buyers Plan, you do not need to pay it back after using it!
With money matters, make sure to talk to your accountant or financial planner to see if it’s right for you.
Call me for more info!