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How to Use the Home Buyers' Plan in 2026: Withdraw Up to $60,000 From Your RRSP Tax-Free, Step by Step

What the Home Buyers' Plan is

Normally, taking money out of an RRSP is expensive. The withdrawal is taxed as income, and your bank holds back up to 30% on the spot.

The Home Buyers' Plan is the exception. It lets you take money out of your RRSP to buy or build a first home, with no tax and nothing withheld. Think of it as an interest-free loan from yourself that you pay back over 15 years.

Who qualifies

You must meet all of these:

• You're a first-time buyer. That means you haven't lived in a home that you or your spouse or partner owned in the current year or the four calendar years before it. If you owned a place a long time ago, you may qualify again.
• You have a written agreement to buy or build a qualifying home.
• You're a resident of Canada when you withdraw, and until you buy or build.
• You'll live there. You must intend to use the home as your main residence within one year of buying or building it.
• You haven't owned the home for more than 30 days before the withdrawal.

There are separate rules that let you use the HBP to buy a home for a person with a disability, even if you're not a first-time buyer.

Step 1: Check what's in your RRSP

Log in to your RRSP and look at two things.

How much is there. You can only withdraw what you have, up to $60,000.

What it's invested in. If the money is in stocks or ETFs, you'll need to sell first. If you're buying within a year or two, move the down payment money into something stable ahead of time, such as a savings ETF or GIC. A market drop the month before closing is a risk you don't need.

Note: locked-in accounts such as a LIRA don't qualify. Some group RRSPs through an employer restrict withdrawals, so ask your plan administrator.

Step 2: Respect the 90-day rule

Any contribution has to sit in your RRSP for at least 90 days before you withdraw it under the HBP. Otherwise you may lose the tax deduction for that contribution.

This creates a useful move. If you have savings outside your RRSP and unused contribution room:

1. Contribute the savings to your RRSP.
2. Wait 90 days.
3. Withdraw it under the HBP.

You end up with the same down payment plus a tax refund from the contribution. On a $20,000 contribution at a 30% tax rate, that's roughly $6,000 back.

Step 3: Fill out Form T1036

Form T1036, "Home Buyers' Plan (HBP) Request to Withdraw Funds from an RRSP," is two short sections.

• You fill in Area 1: your details, the address of the home, and confirmation that you qualify.
• Your RRSP provider fills in Area 2.

Most banks and brokers have their own version of the process online or will send you the form. You need a separate T1036 for each withdrawal and each RRSP.

Step 4: Get the money

Give the form to your RRSP provider. They'll release the funds with no tax withheld.

Timing rules:

• All your HBP withdrawals must be made in the same calendar year, or by the end of January of the next year.
• Allow a week or two for processing. Don't leave it until days before closing.

You'll get a T4RSP slip showing the withdrawal in box 27. You report it on your tax return, but it isn't taxed.

Step 5: Buy or build on time

You have to buy or build the home before October 1 of the year after the withdrawal. Withdraw in 2026 and your deadline is October 1, 2027.

If the purchase falls through, you can cancel your participation and return the money to your RRSP without penalty, using Form RC471.

Step 6: Repay it over 15 years

Each year you repay at least 1/15 of what you took.

The new five-year wait

Normally repayments start in the second year after your withdrawal. There's temporary relief that pushes that back.

So if you withdraw in 2026, your first repayment year is 2031. That gives new owners several years to settle into mortgage payments first.

How to make a repayment

1. Contribute to your RRSP as usual, any time in the year or in the first 60 days of the next.
2. On your tax return, use Schedule 7 to designate part of that contribution as your HBP repayment.

The repaid amount isn't deductible. You got the tax break when you first contributed. You can repay faster than required, which lowers later payments.

Your Notice of Assessment from the CRA shows your HBP balance and the next amount due each year.

If you miss one

The amount you were supposed to repay is added to your income for that year and taxed. It's not a fine, but it's the tax you avoided coming due, and that RRSP room is gone for good.

HBP plus FHSA: stacking both

You can use both programs for the same home.

A couple could put together $120,000 from the HBP and $80,000 or more from two FHSAs.

Which first? The FHSA, if you have time to build it up. You get a deduction going in and never repay it. Use the HBP to top up. See how to open an FHSA and TFSA vs FHSA.

Is it worth it?

The case for:

• A big, tax-free boost to your down payment
• No interest
• Getting to a 20% down payment avoids mortgage default insurance

The case against:

• The money stops growing for your retirement while it's out
• Fifteen years of repayments on top of a mortgage
• Missed repayments get taxed

A fair summary: it's a good tool if it gets you into a home you can comfortably afford. It's a poor one if it stretches you into a home you can't.

Checklist

1. Confirm you qualify as a first-time buyer.
2. Sign a written agreement to buy or build.
3. Make sure RRSP contributions have been in for 90 days.
4. Sell investments in the RRSP so the cash is ready.
5. Complete Form T1036 with your RRSP provider.
6. Receive the funds with no tax withheld.
7. Close by October 1 of the following year.
8. Starting in the fifth year, repay 1/15 a year and designate it on Schedule 7.

Frequently asked questions