RRSP Home Buyer Plan Credit

SMP: Theresa’s Soap Box: RRSP home buyer plan credit

Today we are here to talk about the RRSP home buyer plan credit that you can apply for. If you are looking for a property, it’s your first time buying a house, or you’ve owned a house in the past and you’re waiting to see how long you have to wait until you can use these credits again.

RRSP is one of the more popular home buyer plan credits that you can get. It’s very different from the other first time home buyer credit, which is the property transfer tax credit. Not only do they cover different things, but the qualification is completely different.

First thing about RRSP is that you can take out up to $25,000 from your RRSP account and use that to buy your property. It’s a nice savings, you put the money into RRSP, it is tax free so you have your tax money back, and now you can take it back out tax free and use it for your down payment.

The one thing to note is that it is $25,000 per person. If one spouse has been contributing money into the RRSP, but the other has not, then you can only take out $25,000 from the one person’s name. The other spouse cannot tag along and also take out $25,000 from that person’s account. Chat with your financial advisor and talk about setting up spousal RRSP accounts. Something where the funds that you have in RRSP are more equally divided amongst the different people so when you do need to take out the money, you can apply for $25,000 here and $25,000 there and receive $50,000 in total.


The qualification to be eligible to withdraw home buyer plan funds is very different. There is a 4 year limit. If you or your spouse have owned property in the last 4 years that you live in as your residence, then you are not eligible. It also encompasses you and your spouse together. So if you own the property, your spouse is not on title, but they are your spouse at the time and is within the last 4 years, then you are both not eligible for the RRSP homebuyer plan program. If 4 years has gone by, you sold all of your property, neither of you owned your residence, then you are eligible again to use this program.

This is quite intricate. If you’re curious about that or you’re not sure if you qualify or not, feel free to give us a call at 1-866-924-5244 and we’ll be happy to walk you through the steps. We’ll also let you know about some Government of Canada websites that can walk you through the requirements as well.

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