Canada’s First Home Savings Account
The Canadian government has recently introduced the First Home Savings Account (FHSA) as a new way for Canadians to save towards the purchase of their first home. Here’s everything you need to know:
What is the First Home Savings Account?
The First Home Savings Account is a type of savings account that is designed specifically for Canadians who are looking to save for their first home purchase. The account allows Canadians to contribute up to $40,000 towards the down payment on their first home, and the contributions to the account are tax-free.
Who is Eligible for a First Home Savings Account?
In order to be eligible for a First Home Savings Account, you must be a Canadian resident who has never owned a home before. Additionally, you must be at least 18 years old and have a valid social insurance number.
How does a First Home Savings Account Work?
When you open a First Home Savings Account, you can contribute up to $8,000 per year, up to a maximum of $40,000 overall. The contributions to the account are tax-free, and any interest or investment gains earned on the account are also tax-free. When you withdraw funds from the account to purchase your first home, you will not be required to pay any taxes on the withdrawals.
What are the Benefits of a First Home Savings Account?
There are several benefits to opening a First Home Savings Account. First and foremost, it helps you save money towards the down payment on your first home. Additionally, the tax-free contributions and investment gains can help you maximize your savings potential. Canadians who do not contribute the maximum in any given year can carry over the full $8,000 in contribution room to the following year. Finally, the account is very flexible, allowing you to withdraw funds at any time to use towards the purchase of your first home.
Are there any Drawbacks to a First Home Savings Account?
While there are many benefits to opening a First Home Savings Account, there are also a few drawbacks to consider. For example, if you do not end up using the funds in the account towards the purchase of your first home, you will not be able to carry over the contributions to a different savings account. Additionally, the account can only remain open for up to 15 years, after which the account must be closed and the money moved to avoid taxation.
Overall, the First Home Savings Account is an excellent option for Canadians who are looking to save for their first home purchase. With tax-free contributions and investment gains, and the ability to withdraw funds at any time, it is a flexible and effective savings tool. However, it’s important to weigh the benefits and drawbacks before deciding whether a First Home Savings Account is the right choice for you.
If you have any questions about purchasing your first home, get in touch. We’re here to help guide you through the unique challenges, opportunities and excitement of purchasing your first home.
July 2022 Real Estate Market Report
Greater Toronto Real Estate Market Report July 2022 There were 4,912 home sales reported through the Toronto Regional Real Estate Board (TRREB) MLS® System in July 2022 – down by 47 per cent
June 2022 Market Report
Greater Toronto Real Estate Market Report June 2022 Higher borrowing costs continued to impact home sales in June 2022. Sales totalled 6,474 – down by 41 per cent compared to last year’s strong
Thank You!
Thank You! We had our annual Sutton Admiral awards ceremony last week and I just wanted to say a big thank you to our clients for our incredible success. Serving you is our
How Can We Help You?
Whether you’re looking for your first home, your dream home or would like to sell, we’d love to work with you! Fill out the form below and a member of our team will be in touch within 24 hours to discuss your real estate needs.
Dave Elfassy, Broker
PHONE: 416.899.1199 | EMAIL: [email protected]
Sutton Group-Admiral Realty Inc., Brokerage
1206 Centre Street
Thornhill, ON
L4J 3M9
Read Our Reviews!
![1NVALUABLE – Team Elfassy Real Estate 1NVALUABLE - Team Elfassy Real Estate](https://teamelfassy.com/wp-content/uploads/2021/04/1NVALUABLE-Nicole-Elfassy-Toronto-Real-Estate-Agent.png)
What does it mean to be 1NVALUABLE? It means we’ve got your back. We understand the trust that you’ve placed in us. That’s why we’ll do everything we can to protect your interests–fiercely and without compromise. We’ll work tirelessly to deliver the best possible outcome for you and your family, because we understand what “home” means to you.
![one-percent-real-estate-commission-gta](https://teamelfassy.com/wp-content/uploads/2021/09/one-percent-real-estate-commission-gta.png)