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
| Item | FHSA | RRSP |
|---|---|---|
| Tax deduction | Yes | Yes |
| Tax on qualified withdrawal | None (if requirements are met) | Taxed as income |
| Annual limit | $8,000 | 18% of prior-year earned income, up to $33,810 |
| Lifetime limit | $40,000 | No set lifetime amount. Contributions end on December 31 of the year you turn 71. |
| Carry-forward | Unused room, up to $8,000 | Unused room can be used later. Check your Notice of Assessment in CRA My Account. |
| Deadline | Dec 31, 2026 | Mar 1, 2027 |
| Purpose requirement | A qualifying first home purchase | Retirement savings. The Home Buyers' Plan allows withdrawals for a qualifying home. |
Source: www.canada.ca · As of: Oct 2026 Estimate
Numbers example
| Taxable income | FHSA: Estimated refund | FHSA: Net cost | RRSP: Estimated refund | RRSP: 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 Estimate
Provincial or territorial brackets · Source: www.canada.ca · As of: Oct 2026 Estimate
Basic personal amount · Source: www.canada.ca · As of: Oct 2026 Estimate
What the difference depends on
- When you plan to buy a home
- Your tax rate now and in retirement
- Your contribution room
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.