Home Ownership Incentives
"Government Programs to help you save"
Home Buyers' Plan (HBP)
The Government of Canada's Home Buyers' Plan allows qualified buyers to withdraw a maximum of $25,000 from their RRSPs to purchase or build a house. If your spouse is also eligible, you can each withdraw up to $25,000 towards the down payment, for a total of $50,000. No income tax is deducted from these funds, as long as they are repaid to the RRSP according to the government's repayment schedule.
How the Plan Works
You may participate in the plan if you (or your spouse) have not owed a home which you occupied as your principal residence in the last five years.
The money you withdraw from your RRSP must be repaid over a period of no more than 15 years to retain its tax deferred status. Your repayment period starts the second year you made your withdraws. For example, in October 2003 you withdraw $15,000 from your RRSP to finance the purchase of your home. Your first annual repayment of $1,000 ($15,000 divided by 15 years) is due December 31, 2005.
For more information go to the Canadian Customs and Revenue Agency web site at www.ccra-adrc.gc.ca and search for 'Home Buyers Plan'.