FHSA vs RRSP: Differences, Limits and Tax Refund (2026)

Contributions to both reduce taxable income by the same amount, so the refund is the same. A qualifying FHSA withdrawal is not taxed, while an RRSP withdrawal is taxed as income. Annual limits and deadlines also differ.

This page shows how FHSA and RRSP differ. It does not say which account is better for you.

Differences

FHSA and RRSP compared
ItemFHSARRSP
Tax deductionYesYes
Tax on qualified withdrawalNone (if requirements are met)Taxed as income
Annual limit$8,00018% of prior-year earned income, up to $33,810
Lifetime limit$40,000No set lifetime amount. Contributions end on December 31 of the year you turn 71.
Carry-forwardUnused room, up to $8,000Unused room can be used later. Check your Notice of Assessment in CRA My Account.
DeadlineDec 31, 2026Mar 1, 2027
Purpose requirementA qualifying first home purchaseRetirement savings. The Home Buyers' Plan allows withdrawals for a qualifying home.

Source: www.canada.ca · As of: Oct 2026

Numbers example

Example: $8,000 contribution in British Columbia
Taxable incomeFHSA: Estimated refundFHSA: Net costRRSP: Estimated refundRRSP: Net cost
$60,000$1,832.01$6,168.00$1,832.01$6,168.00
$85,000$2,256.00$5,744.00$2,256.00$5,744.00
$120,000$2,720.43$5,279.57$2,720.43$5,279.57

It depends on your income, home-buying plans and tax rate in retirement.

Federal brackets · Source: www.canada.ca · As of: Oct 2026

Provincial or territorial brackets · Source: www.canada.ca · As of: Oct 2026

Basic personal amount · Source: www.canada.ca · As of: Oct 2026

What the difference depends on

Home-buying plans. A qualifying FHSA withdrawal is not taxed. An RRSP withdrawal is taxed as income.

Tax rates. Both contributions lower taxable income in the year they are deducted. With an RRSP, the rate that applies when the money comes out is also part of the picture.

Contribution room. The FHSA has a fixed annual amount, while the RRSP limit depends on prior-year earned income. So the room available in each account can be quite different from one person to the next.

Estimate for information only, not tax or investment advice. Based on 2026 tax rates. Excludes the Ontario Health Premium, CPP/EI and other credits.