The Home Buyers' Plan in 2026: Limits and Repayment

On a Saturday morning in Burnaby, a couple sits at the kitchen table with a printout of a townhouse near Brentwood and a laptop open to their RRSP statements. Between the two accounts there's about $62,000. They already know they like the place. What they don't know is how much of that RRSP money they're allowed to touch, whether it gets taxed, and what the payback looks like once they've moved in.

That's the Home Buyers' Plan question, and it comes up in almost every first-home conversation across Metro Vancouver. Here's what the actual rules say in 2026.

What the Home Buyers' Plan is

The Home Buyers' Plan lets you take money out of your RRSP to buy or build a qualifying home without that withdrawal being taxed as income in the year you take it, as long as you meet the conditions and pay it back over time. The rules aren't a CRA policy or a bank product. They sit in section 146.01 of the Income Tax Act, and the consolidated version of that section is current to June 21, 2026.

A "qualifying home" is a housing unit located in Canada, or a share in a co-operative housing corporation that entitles you to possess one.

How much you can withdraw

The Act caps it plainly. A withdrawal only counts as a "regular eligible amount" if the total of it and all other eligible amounts you received in that calendar year "does not exceed $60,000" (Income Tax Act, s. 146.01(1)). That figure replaced the old $35,000 ceiling.

Two things people miss:

• It's per person, not per household. Each spouse or partner who qualifies can withdraw up to $60,000 from their own RRSP, so a couple who both qualify can bring up to $120,000 to the table.
• Your Home Buyers' Plan balance has to be nil at the start of the calendar year. If you still owe money from an earlier participation, a new withdrawal isn't an eligible amount.

And of course, you can only withdraw what's actually in the RRSP. The $60,000 is a ceiling, not an entitlement.

The conditions that catch people out

These are the ones that turn a smooth closing into a tax problem. All of them come straight from the definition of "regular eligible amount" in s. 146.01(1):

• You need a written agreement first. You must have entered into a written agreement to buy or build the home *before* the withdrawal. Pulling money out to go shopping doesn't work.
• The 30-day rule. Neither you nor your spouse or common-law partner can have acquired the home more than 30 days before the withdrawal.
• The four-year rule. You can't have had an owner-occupied home in the period starting at the beginning of the fourth preceding calendar year and ending on the 31st day before the withdrawal. So this isn't strictly for people who have never owned. It's for people who haven't owned and lived in a home for roughly four years.
• Your partner's home can count against you. If your spouse or partner owned a home in that same window and you lived in it during the relationship, you're out. There's a separate carve-out where a marriage or common-law partnership has broken down and you've been living separate and apart for at least 90 days.
• You have to intend to live there. The prescribed request form asks you to identify a home you've begun using, or intend to begin using within one year of acquiring it, as a principal place of residence.
• You need to buy before the deadline. The Act uses a "completion date," which for current withdrawals is October 1 of the calendar year following the year you took the money out. You generally have to acquire the home before that date.
• The 90-day contribution rule. If you contribute to an RRSP and then withdraw it as a Home Buyers' Plan amount less than 90 days later, that contribution can be denied as a deduction (Income Tax Act, s. 146(5)). If you're planning to contribute and then withdraw, the calendar matters.

Repayment: the 15-year clock

You repay by making an RRSP contribution and then designating it as a Home Buyers' Plan repayment on a prescribed form filed with your tax return. The Act's formula in s. 146.01(4) divides your outstanding balance over a 15-year window, which is why the shorthand "one fifteenth a year" gets used.

If you designate less than the required amount for a year, the shortfall doesn't disappear. It gets included in your income for that year and taxed at your marginal rate. Two other triggers pull the whole balance into income: ceasing to be a resident of Canada, and death, though there's an election that lets a surviving spouse take over the balance instead.

The grace period got longer

This is the part that changed most recently. Section 146.01(4.1) now applies where the completion date is "after 2022 and before 2030," and it directs that the reference to the "first calendar year" in the repayment formula be read as the "fourth calendar year." In plain terms, the start of the repayment period is pushed back by three years.

The Spring Economic Update 2026 describes the extension the way most people would: the grace period before you have to start repaying goes "from two years to five years" for participants making a first withdrawal between January 1, 2026 and December 31, 2028. It puts the cash flow relief at up to $4,000 a year per person, which is one fifteenth of $60,000, for each of the three deferred years. Its own example: a first withdrawal in 2026 means the first repayment year is 2031.

Worth being blunt about what that is. It's a deferral, not forgiveness. The balance is still yours to repay, and the money sitting outside your RRSP isn't invested while it waits.

Where the FHSA fits

For a lot of Vancouver and Coquitlam buyers the more interesting question is how the Home Buyers' Plan sits alongside a First Home Savings Account. The FHSA deduction limits in s. 146.6 of the Income Tax Act run to $8,000 in a year against a $40,000 lifetime figure, and an FHSA withdrawal for a qualifying home never has to be paid back. The FHSA rules use a similar four-year owner-occupied test. The two plans are separate buckets with separate paperwork, and which mix makes sense depends on your income, your RRSP room and how soon you're buying.

A British Columbia wrinkle

"First-time home buyer" doesn't mean the same thing federally and provincially. B.C.'s First Time Home Buyers' Program for property transfer tax requires that you have never owned a registered interest in a property that was your principal residence anywhere in the world, ever. Its value thresholds, effective April 1, 2024, give a full exemption on the first $500,000 where the fair market value is $835,000 or less, with a partial exemption between $835,000 and $860,000.

So a New Westminster buyer who sold a condo six years ago can qualify for the Home Buyers' Plan under the federal four-year rule and still get nothing from the provincial exemption. Two different governments, two different definitions, one purchase.

What this doesn't tell you

• It doesn't tell you whether withdrawing is a good idea for you. Money out of the RRSP isn't growing inside it, and the trade-off between a larger down payment now and decades of tax-sheltered compounding is personal arithmetic, not a rule.
• Legislation states the conditions but not the administration. CRA forms, filing deadlines and how your plan issuer processes the request all matter, and they change more often than the Act does.
• The extended grace period reduces near-term pressure and increases the risk of forgetting. Five quiet years is long enough for a repayment schedule to slip your mind.
• Where thresholds are indexed or under review, verify the current-year figure before you act. The numbers quoted here are the ones published in the sources listed below, on the dates shown.
• Nothing here covers your provincial income tax position, mortgage qualification, or whether the lender will accept the funds the way you expect.

Sources

• Government of Canada, Department of Justice. *Income Tax Act*, R.S.C. 1985, c. 1 (5th Supp.), section 146.01 (Home Buyers' Plan). Consolidation current to June 21, 2026. https://laws-lois.justice.gc.ca/eng/acts/i-3.3/section-146.01.html
• Government of Canada, Department of Justice. *Income Tax Act*, section 146 (Registered Retirement Savings Plans), subsection 146(5). https://laws-lois.justice.gc.ca/eng/acts/i-3.3/section-146.html
• Government of Canada, Department of Justice. *Income Tax Act*, section 146.6 (First Home Savings Account). https://laws-lois.justice.gc.ca/eng/acts/i-3.3/section-146.6.html
• Government of Canada, Department of Finance. *Spring Economic Update 2026*, Chapter 2. https://budget.canada.ca/update-miseajour/2026/report-rapport/chap2-en.html
• Province of British Columbia. *First Time Home Buyers' Program*, property transfer tax exemptions. https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/exemptions/first-time-home-buyers

If you're weighing an RRSP withdrawal against an FHSA, or you just want someone to check the dates before you sign anything, book a free no-pressure call with Milo. He's an independent broker in Burnaby, he works with families in English and Tagalog, and the first conversation is about your situation, not a product.

*This article summarises published rules and research for general information, is current as of the date shown, and is not personalized financial, tax or legal advice.*