RRSP Home Buyer's Plan

February 8, 2012 - Updated: February 8, 2012

RRSP Home Buyer's Plan

 

     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 (RRSPs) for buying or building a home in Canada.

To qualify, applicants must not have directly, or indirectly, owned a residence within the past five years.

       Under the HBP, qualifying withdrawals will not be included in annual income, and RRSP issuers will not withhold income tax from these withdrawn amounts. If you are jointly buying or building a home together with your spouse or other qualifying individual, each of you can withdraw up to $20,000.

     Under the HBP, qualifying withdrawals will not be included in annual income, and RRSP issuers will not withhold income tax from these withdrawn amounts

 

    If you are jointly buying or building a home together with your spouse or other qualifying individual, each of you can withdraw up to $20,000.

        To withdraw these funds from your RRSPs, you must first have entered into a written agreement to buy or to build. You will also need to confirm that you will occupy the subject property as your personal residence. (Once you take occupancy there is no minimum period of time you are required to live there.)

 

         Your commitment to the HBP is to repay the amount withdrawn within a 15 year time period. In each year, you will need to make the minimum contributions to your RRSPs equal to 1/15 of the withdrawn funds until the total amount is repaid. You will receive a HBP Statement of Accounts on your annual Notice of Assessment showing you the total HBP withdrawal, the amount you have repaid to date, your HBP balance, and the amount you should repay the following year. Your repayment starts the second year following your withdrawal, and you may repay any amount in excess of the minimum to reduce payments in later years.

 

 

 

 

 


Tagged with: rrsp hbp tax buying real estate property real estate
| | Share

Leave a comment...

Please enter the numbers found on the right.

Condominium.Ca Natasha McColl

Sutton Group Realty Systems Inc. Brokerage

Independently owned and operated

2186 Bloor Street West, Toronto ON, M6S 1N3

Office: 416-762-4200

Fax: 416-762-6829

info@condominium.ca

Powered by Lone Wolf Real Estate Technologies (CMS6)