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The HBP lets you borrow money from yourself to help pay for a new home. Find out how the Home Buyers’ Plan works in the MoneySense Glossary.
The Home Buyers’ Plan (HBP) is a federal program that allows Canadians to withdraw money from their registered retirement savings plans (RRSPs) without penalty to buy or build a home for themselves or for a related person with a disability. This money must be repaid to the RRSP within 15 years or it will be included in the borrower’s taxable income.
The new home must be in Canada. It must be purchased or completed by October 1 of the year after the year the money was withdrawn.
To participate in the Home Buyers’ Plan, you must be a Canadian resident and qualify as a first-time home buyer under the program’s definition. The rules allow people who owned homes in the past to re-qualify as “first-time” buyers after four years.
The current maximum withdrawal is $60,000 per person. Couples who each have RRSPs may be able to access up to $120,000.
Example: “Gwen wanted to buy a home for her adult son, who has a disability. Because he qualified for the disability amount for tax purposes, she used the Home Buyers’ Plan to withdraw $60,000 from her RRSP without penalty to help fund the purchase.”
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