First-time homebuyers who are Canadian residents can now withdraw (as of March 2019 budget) up to $35,000 from their RRSP TAX FREE. If you have a partner, that means that you can each withdraw up to $35,000 for a total of $70,000 to build or buy a qualifying home.

Getting access to your RRSPs through the HBP is fairly easy. Fill out form T1036 at your financial institution for each withdrawal. Then make sure to file an income tax return for the year of the withdrawal and each year thereafter, until the RRSP is fully repaid.

Keep in mind there are a few rules:

• To qualify, you must be a first time home buyer and a resident of Canada at the time of withdrawal.
• You MUST purchase/build the home before October 1st after the year of withdrawal, so within 9 months if withdrawn on December 31st, and 21 months if withdrawn after January 1st, so make sure you figure the dates correctly!.
• You only need to repay 1/15 of the borrowed amount starting in the second year after the year of withdrawal, or the CRA will add 1/15th to your taxable income for the year.
• RRSP contributions of up to 90 days before the withdrawal date can be used towards the HBP.  You can still remove all your RRSP funds but the last 90 days worth of contributions will be taxable in the year of contribution.

This is one of the only ways to withdraw from your RRSP tax free and a great way to get yourself into the real estate market. For more information about the HBP program go to the CRA website.

Like to know if you could qualify for a mortgage? Check out Can I Get a Mortgage or contact us for a free pre-assessment.