Are you eligible for the Home Buyers’ Plan?

To qualify for the Home Buyers’ Plan a few conditions must be met, these include:

• Be a Canadian resident when you make your first eligible withdrawal from your RRSP up to the time of the home purchase.
• Be a qualifying first-time home buyer as described under the Canada Income Tax Plan.
  
• Hold a written agreement to purchase or build a home for yourself or a related disabled person
• Intend to occupy the qualifying home as your principal place of residence within the first year of purchase.
• Withdrawal must be made within 30 days of the date you acquire the home.

There can be other factors that come with qualifying for the Home Buyers’ Plan. Ask your TD Personal Banker for details, they are happy to assist.

How to withdraw funds from RRSPs for the Home Buyers’ Plan?

With a Home Buyers’ Plan, you can withdraw up to $60,000 from your RRSP. If your spouse or common-law partner has an RRSP, you can each withdraw up to $60,000 or a total of $120,000 as a couple.

There are a few steps to consider before you start making withdrawals from your RRSP through the Home Buyers’ Plan, this includes:

• Refer to the Home Buyers Plan request Form T1036 for details regarding withdrawals from your RRSP; a separate form must be completed for each withdrawal.
• Ensure your funds are in your RRSP for at least 90 days before taking them out and you must withdraw the money no later than 30 days after the closing date of a qualifying home.
• All withdrawals must be repaid to your RRSP within 15 years.

How to repay the RRSP withdrawn funds used for the Home Buyers’ Plan

Your repayments will begin the second year following the year you took the money out of your RRSP. You can make repayments over a maximum of 15 years. You must begin repayment the second year after the year you made your first withdrawal from your RRSPs under the Home Buyers Plan.

The Canada Revenue Agency (CRA) will send you an annual HBP repayment amount on your Notice of Assessment. For more information, refer to the Canada Revenue Agency (CRA) site.

Can you cancel the Home Buyers’ Plan?

If you’ve made withdrawals from your RRSP and have met all the requirements of the Home Buyers’ Plan (HBP), you’re typically not able to cancel but there are some exceptions. If you would like more information, visit the CRA website.

Benefits of the Home Buyers’ Plan

If you borrow money from your RRSP for your first home, you can:

• Use the money you’ve saved in your RRSP toward the purchase of your first home.
• Delay the start of repayments to the second year after the withdrawal.
• Enjoy flexible, no-penalty payback options.
• Treat it like an interest-free loan from your RRSP.

In addition to the Home Buyers’ Plan, TD offers a First Home Savings Account (FHSA). This is a registered plan that allows qualifying first-time homebuyers to build tax-free savings for the purchase of a qualifying home. Speak to a TD Personal Banker to determine the right option for you.