FHSA contributions are tax-deductible. Put $8,000 into your FHSA and you can subtract $8,000 from your taxable income. How much that's worth depends on your marginal tax rate, the combined federal and provincial rate on your last dollar of income.
What to know
- Deduct contributions made in the calendar year. There's no 60-day window into the next year.
- You can carry unclaimed deductions forward indefinitely and claim them in a later, higher-income year.
- Transfers in from an RRSP aren't deductible, because that money was already deducted.
- Qualifying withdrawals are tax-free, so you never pay back the deduction if you buy a home.
What the deduction is worth
Your refund is roughly your contribution multiplied by your marginal tax rate. Marginal rates vary by province and income, so the table below uses round illustrative rates. Look up your own combined rate for an exact figure, or use our calculator.
| Your marginal rate | $2,000 contribution | $8,000 contribution | $40,000 over 5 years |
|---|---|---|---|
| 20% | $400 | $1,600 | $8,000 |
| 30% | $600 | $2,400 | $12,000 |
| 40% | $800 | $3,200 | $16,000 |
| 50% | $1,000 | $4,000 | $20,000 |
Reinvesting that refund into a TFSA or back into your down payment savings is what makes the FHSA so powerful. The government is in effect funding part of your down payment.
Delaying the deduction
You don't have to claim your FHSA deduction in the year you contribute. Unclaimed amounts carry forward with no expiry, and you can claim any portion of them in a future year. This is useful if:
- Your income is low now, because you're a student, on parental leave, or early in your career.
- You expect a big raise or a move into a higher bracket.
- You have a one-time income spike coming, such as a bonus or severance, and want to offset it.
Example: a graduate earning $38,000 contributes $8,000 in 2026 but doesn't claim it. In 2028 their income is $90,000. Claiming the $8,000 then saves tax at a meaningfully higher rate. Meanwhile, the money has been growing tax-free inside the FHSA the whole time.
Contribute now, deduct later. Delaying the deduction doesn't mean delaying the contribution. Room you don't use is capped at $8,000 of carry-forward, but deductions you don't claim are not capped.
How to claim it on your return
- Your FHSA provider issues a T4FHSA slip showing your contributions for the year.
- Complete Schedule 15, FHSA contributions, transfers and activities, where you report contributions and choose how much to deduct.
- The deduction goes on line 20805 of your return.
Tax software walks you through Schedule 15 automatically once you enter your T4FHSA. You need to file Schedule 15 for any year you opened an FHSA, even if you didn't contribute, so the CRA can track your room.
How it compares to the RRSP deduction
The two work similarly going in. The difference is on the way out. An RRSP deduction is really a deferral: you pay tax when you withdraw in retirement, or repay any Home Buyers' Plan withdrawal over 15 years. An FHSA deduction used for a qualifying home is permanent. You never pay it back. Dollar for dollar, if you're buying a first home, the FHSA deduction is the better one.
Frequently asked questions
Is the FHSA tax deductible?
Yes. Contributions to your own FHSA are deductible from your taxable income. Transfers from an RRSP are not.
Can I claim the FHSA deduction if I contributed in January for last year?
No. Contributions are deductible for the calendar year they're made in, or a later year. They can't be applied to the previous year.
What happens to my deduction if I never buy a home?
If you transfer the money to your RRSP, it's taxed later when withdrawn from the RRSP, just like normal RRSP savings. If you withdraw it directly, it's taxed as income that year.
Can I claim my unused FHSA deduction after I close the account?
Yes. Unclaimed FHSA deductions can still be claimed in later years, even after the account is closed.
Sources
- Canada Revenue Agency, Tax deductions for FHSA contributions
- Canada Revenue Agency, Schedule 15, FHSA contributions, transfers and activities