How does the first time Home Buyer’s Plan (HBP) work?
A – The First-time Home Buyer’s Plan (HBP) is a Federal Government initiative providing Canadian citizens the opportunity to withdraw up to $20,000 from personal registered retirement savings plans (RRSP’s) for buying or building a qualifying home for oneself or for a related disabled person. In order to qualify, applicants can not have owned directly, or indirectly, a residence within the past five years. Under the HBP, qualifying withdrawals will not be included in annual income, and RRSP issuers do not withhold income tax from these withdrawn amounts. The $20,000 maximum limit is per person, so if you are jointly buying or building a home together with your spouse or other qualifying individuals, then each of you can withdraw up to $20,000. To withdraw these funds from your RRSP’s you must first have entered into a written contract/agreement to buy or to build a home. You must also confirm that you will occupy the subject property as your personal residence. Your first repayment is
