Buying your first home in Canada? You have access to some of the most generous first-time buyer incentives in the world. Between the FHSA, Home Buyers' Plan, tax credits, and provincial rebates, you can save over $50,000 on your down payment and closing costs. Here's everything you need to know to maximize every incentive in 2026.
First-Time Home Buyer Incentives (2026)
Canada offers multiple federal and provincial programs to help first-time buyers. Here's the complete list:
| Incentive | Maximum Value | Key Details |
|---|---|---|
| FHSA (First Home Savings Account) | $40,000 | $8k/year, $40k lifetime. Tax-deductible contributions, tax-free withdrawal. No repayment required. |
| Home Buyers' Plan (HBP) | $60,000 | Withdraw from RRSP tax-free. Must repay over 15 years starting year 2. |
| First-Time Home Buyers' Tax Credit | $1,500 | Federal non-refundable credit. $10,000 × 15% = $1,500 reduction in tax owing. |
| Ontario Land Transfer Tax Rebate | $4,000 | ON only. Covers full LTT on homes up to $368k. Toronto has additional $4,475 rebate. |
| BC Property Transfer Tax Exemption | $8,000 | BC only. Full exemption on homes up to $500k, partial up to $835k. |
| GST/HST New Housing Rebate | $30,000+ | New builds only. 36% rebate on GST portion. Available on homes under $450k (partial up to $800k). |
FHSA is the Best Program — Use It First
The FHSA is a game-changer: you get a tax deduction when you contribute (like RRSP) AND tax-free withdrawal (like TFSA). Unlike the HBP, you never have to repay FHSA funds. Maximize your FHSA first ($8,000/year for 5 years = $40,000), then use HBP if you need additional down payment funds.
Calculate Your Total Incentives
Use our interactive calculator to see exactly how much you qualify for based on your home price, income, province, and savings. See your total down payment power from FHSA and HBP combined.
First-Time Home Buyer Incentives Calculator
Calculate all federal and provincial incentives you qualify for as a first-time home buyer in Canada. See how much you can save on your down payment and closing costs.
Total price of the home
Combined income (you + partner)
Max $40,000 lifetime
Max $60,000 per person
Your First-Time Home Buyer Incentives
How to use these incentives: The FHSA and HBP give you up to $100,000in tax-free funds for your down payment. The FHSA is better because you never have to repay it (unlike HBP's 15-year repayment). Maximize your FHSA first ($8,000/year, $40,000 lifetime), then use HBP if you need more.
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Real-World Examples
Let's look at three first-time buyer scenarios to see how these incentives work in practice:
Using FHSA + HBP Together (Toronto)
Single buyer maximizing both programs
Scenario:
- •Alex, age 32: Buying a $700,000 condo in Toronto
- •Income: $95,000/year (30% marginal tax rate)
- •Savings: FHSA $40,000 (5 years × $8,000), RRSP $60,000 for HBP
Result: Alex has $100,000 in tax-free down payment funds (14.3% down on a $700k home). With tax savings and rebates, total value is $121,975. The FHSA is the MVP here — $40k that never needs to be repaid, plus $12k in tax refunds over the years.
First Home in Toronto (Couple)
Both partners maximize incentives
Scenario:
- •Priya & James: Buying an $850,000 detached home in Toronto suburbs
- •Combined income: $180,000 (each earns $90k)
- •Savings: Each has FHSA $40k and RRSP $60k for HBP
Result: As a couple, Priya and James have $200,000 in down payment funds — enough to avoid CMHC mortgage insurance entirely (20%+ down). Combined with tax savings and rebates, they receive $233,975 in total incentives. This is the power of two first-time buyers maximizing all programs together.
First Home in Calgary (New Build)
Maximizing GST rebate on new construction
Scenario:
- •Kevin, age 28: Buying a $420,000 new-build townhouse in Calgary
- •Income: $72,000/year
- •Savings: FHSA $32,000 (4 years), RRSP $45,000
Result: Kevin has $77,000 for his down payment (avoiding CMHC insurance). The GST rebate on his new build adds an extra $7,560. Alberta has no land transfer tax, saving thousands compared to Ontario. Total incentives: $94,060. New builds under $450k qualify for significant GST rebates that resale homes don't get.
Key Takeaway from Examples
The combination of FHSA and HBP gives first-time buyers $100,000 in tax-free down payment funds(single) or $200,000 as a couple. Add tax savings, credits, and provincial rebates, and you can access over $50,000 in total incentives as a single buyer, or over $100,000 as a couple. Start your FHSA early to maximize the 5-year contribution window ($8,000/year).
Frequently Asked Questions
Frequently Asked Questions
Q:Can I use both FHSA and HBP together for the same home?
A:Yes, absolutely! You can use both the FHSA (up to $40,000) and the Home Buyers' Plan (up to $60,000 per person) together for the same home purchase. This gives you up to $100,000 in tax-free down payment funds as a single buyer, or $160,000 as a couple (each partner uses both programs). The key difference: FHSA funds never need to be repaid, while HBP withdrawals must be repaid to your RRSP over 15 years starting in year 2. For this reason, maximize your FHSA first ($8,000/year), then use HBP if you need additional funds.
Q:What if my partner is not a first-time buyer?
A:You can still qualify for first-time buyer incentives even if your partner has owned a home before, but only YOU (the first-timer) can use the FHSA and HBP. Your partner cannot. However, if you're buying together, you still get the First-Time Home Buyers' Tax Credit ($1,500) as long as ONE of you qualifies. For land transfer tax rebates, rules vary by province — in Ontario, only the first-time buyer portion gets the rebate. In practice, this means as a couple you'd get $100,000 in tax-free down payment funds (your $40K FHSA + your $60K HBP) instead of $160,000.
Q:What is the 5-year lookback rule for first-time buyers?
A:To qualify as a 'first-time home buyer' for most programs, you cannot have owned a home that you lived in as your principal residence in the past 5 years (January 1 to December 31). However, the FHSA has a much stricter rule: you cannot have owned a home you lived in at any time in the year you open the FHSA or the preceding 4 calendar years. For example, if you sold your home in 2022, you can't open an FHSA until 2027. The HBP and tax credit use the standard definition: you and your spouse/partner must not have owned a home in the last 5 years.
Q:Are there income limits for first-time buyer programs?
A:No, there are no income limits for the FHSA, Home Buyers' Plan, or the First-Time Home Buyers' Tax Credit — anyone can use these regardless of how much they earn. However, some provincial programs do have income restrictions. For example, BC's First-Time Home Buyers' Program has income limits. The federal programs are universal, making them accessible to all first-time buyers from low-income to high-income households.
Q:How much can I save with land transfer tax rebates?
A:Land transfer tax rebates vary significantly by province. In Ontario, first-time buyers get a rebate of up to $4,000 (maximum $4,000) which covers the full land transfer tax on homes up to $368,000. In BC, the rebate is up to $8,000, covering the tax on homes up to $500,000. Toronto has an additional municipal land transfer tax, with a separate rebate up to $4,475 for first-timers. Alberta has no land transfer tax, so no rebate is needed. These rebates are claimed when you register your home, not on your tax return, and can save thousands at closing.
Question: Can I use both FHSA and HBP together for the same home?
Answer: Yes, absolutely! You can use both the FHSA (up to $40,000) and the Home Buyers' Plan (up to $60,000 per person) together for the same home purchase. This gives you up to $100,000 in tax-free down payment funds as a single buyer, or $160,000 as a couple (each partner uses both programs). The key difference: FHSA funds never need to be repaid, while HBP withdrawals must be repaid to your RRSP over 15 years starting in year 2. For this reason, maximize your FHSA first ($8,000/year), then use HBP if you need additional funds.
Question: What if my partner is not a first-time buyer?
Answer: You can still qualify for first-time buyer incentives even if your partner has owned a home before, but only YOU (the first-timer) can use the FHSA and HBP. Your partner cannot. However, if you're buying together, you still get the First-Time Home Buyers' Tax Credit ($1,500) as long as ONE of you qualifies. For land transfer tax rebates, rules vary by province — in Ontario, only the first-time buyer portion gets the rebate. In practice, this means as a couple you'd get $100,000 in tax-free down payment funds (your $40K FHSA + your $60K HBP) instead of $160,000.
Question: What is the 5-year lookback rule for first-time buyers?
Answer: To qualify as a 'first-time home buyer' for most programs, you cannot have owned a home that you lived in as your principal residence in the past 5 years (January 1 to December 31). However, the FHSA has a much stricter rule: you cannot have owned a home you lived in at any time in the year you open the FHSA or the preceding 4 calendar years. For example, if you sold your home in 2022, you can't open an FHSA until 2027. The HBP and tax credit use the standard definition: you and your spouse/partner must not have owned a home in the last 5 years.
Question: Are there income limits for first-time buyer programs?
Answer: No, there are no income limits for the FHSA, Home Buyers' Plan, or the First-Time Home Buyers' Tax Credit — anyone can use these regardless of how much they earn. However, some provincial programs do have income restrictions. For example, BC's First-Time Home Buyers' Program has income limits. The federal programs are universal, making them accessible to all first-time buyers from low-income to high-income households.
Question: How much can I save with land transfer tax rebates?
Answer: Land transfer tax rebates vary significantly by province. In Ontario, first-time buyers get a rebate of up to $4,000 (maximum $4,000) which covers the full land transfer tax on homes up to $368,000. In BC, the rebate is up to $8,000, covering the tax on homes up to $500,000. Toronto has an additional municipal land transfer tax, with a separate rebate up to $4,475 for first-timers. Alberta has no land transfer tax, so no rebate is needed. These rebates are claimed when you register your home, not on your tax return, and can save thousands at closing.
Watch Our Complete Video Guide
Prefer to watch? Check out our comprehensive video breakdown of first-time home buyer incentives, complete with examples and step-by-step instructions for FHSA and HBP.
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