The FHSA (Tax-Free First Home Savings Account) is a Canadian registered account that combines the benefits of RRSPs and TFSAs. It allows first-time home buyers to save up to $8,000 per year (up to a lifetime limit of $40,000) with tax-deductible contributions and tax-free withdrawals for the purchase of a qualifying home.

Key features

Annual fee: $8,000 per year.

Lifetime limit: $40,000.

Carry forward: Maximum of $8,000 of unused entitlement from one year to the next.

Tax deduction: Contributions reduce your taxable income (such as an RRSP).

Tax-free withdrawal: No tax payable if the money is used to buy a first home (such as a TFSA).

Maximum term: 15 years after account opening or until age 71.

Eligibility criteria

• Be a resident of Canada.
• Be at least 18 years of age (or the age of majority in your province).
• Not have lived in a property that you (or your spouse owned) in the current calendar year or in the previous four calendar years.

It is important to meet all the criteria on the form to be eligible. Do not hesitate to discuss it with your tax accountant or refer to the Canada Revenue Agency website  First Home Savings Account (FHSA) - Canada.ca