The First Home Savings Account launched in 2023 and combines the best features of the RRSP and TFSA for first-time home buyers. Contributions are tax-deductible (like an RRSP), and withdrawals for a qualifying home purchase are completely tax-free (like a TFSA). There is no payback requirement.
Annual contribution limit is $8,000 (up to $16,000 if you didn't contribute last year via carry-forward). Lifetime limit is $40,000. You can hold the account for up to 15 years; if you don't buy a home in that time, the FHSA must be wound down. Contents can roll tax-free into an RRSP.
To qualify as a first-time home buyer, you must not have owned (or lived in a home owned by your spouse) in the current year or any of the prior four calendar years. The home must be your principal residence within one year of purchase.
For Canadian FIRE enthusiasts, the FHSA is a no-brainer if you're eligible. You get a tax deduction on the way in and tax-free growth. For most high earners, it's worth roughly $12,000-$16,000 of tax savings over its lifetime on the $40,000 contribution.