Home Buyers' Plan Repayment Rules: The $60,000 RRSP Loan You Can't Forget
By Jordan Ellis · Published · Reviewed
Quick Answer
The Home Buyers' Plan lets each first-time buyer withdraw up to $60,000 from their RRSP tax-free ($120,000 per couple) for a home purchase. Repayment is 1/15th of the balance per year — $4,000 annually on the maximum — normally starting in the second year after withdrawal, and any missed repayment is added to your taxable income for that year with the RRSP room permanently lost. Temporary relief: if your first HBP withdrawal is made from 2022 to 2028, repayments start in the fifth year after the year of withdrawal. The HBP stacks with the FHSA for up to $100,000 per person in tax-advantaged down payment money.
The HBP is the most generous loan you’ll ever get from yourself — $60,000 of your own RRSP, tax-free, interest-free — and the most quietly punished when ignored. The rules, minus the fog.
Getting the money out
- Limit: $60,000 per person ($120,000/couple), from RRSPs only
- Eligibility: first-time buyer test (no owner-occupied home by you or your spouse in the current + prior 4 calendar years) plus a signed purchase agreement
- Timing: withdraw in the calendar year of purchase or by October of the following year; contributions must be in the RRSP at least 90 days before withdrawal or the deduction on them can be clawed back
- One form: T1036 per withdrawal, no tax withheld, no income inclusion — as long as you buy
Compare that against the FHSA with the FHSA calculator before deciding the mix; our FHSA guide covers why the FHSA is the better first dollar.
The 15-year repayment machine
Starting in the second year after withdrawal (the fifth year if your first withdrawal was made from 2022 to 2028), you owe 1/15th per year:
| Withdrawn | Annual repayment | Over 15 years |
|---|---|---|
| $20,000 | $1,333 | $20,000 |
| $35,000 | $2,333 | $35,000 |
| $60,000 | $4,000 | $60,000 |
Mechanics: contribute to any RRSP, designate on Schedule 7. Miss a year and CRA adds that year’s amount to your income — $4,000 missed at a 30% bracket ≈ $1,200 of tax — and the room dies permanently. There is no catch-up; there’s only the annual minimum and, if you like, faster.
The strategic questions
Repay fast or slow? Slow is mathematically fine (it’s an interest-free loan), fast restores tax-sheltered compounding. The tiebreaker: if your RRSP is your main retirement engine, treat repayment like a non-negotiable bill and automate it in January.
What if I don’t buy? Cancel by returning the funds to an RRSP by December 31 of the year after withdrawal — otherwise the full amount becomes taxable income.
HBP vs down payment from cash? The HBP shines when your cash is short and your RRSP is fat. If you have unregistered cash, compare: RRSP money withdrawn via HBP must be repaid from after-tax dollars — you effectively convert sheltered money into a repayment obligation. Run the down payment scenarios through the down payment calculator and the full affordability picture with the mortgage stress test calculator before raiding anything.
One-line summary: the HBP is excellent when respected and expensive when forgotten. Automate the $4,000 every January and it’s the cheapest $60,000 you’ll ever borrow.
Official sources
Rules and dollar limits change. Confirm current amounts with the official pages below before you act · Last reviewed .
- The Home Buyers' Plan (Canada Revenue Agency)
- Repaying amounts withdrawn under the Home Buyers' Plan (Canada Revenue Agency)