The Home Buyers’ Plan (HBP) is a program that allows you to withdraw up to $25,000 from your registered retirement savings plan (RRSPs) to buy or build a qualifying home for yourself or for a related person with a disability.

You must be considered a first-time home buyer.

You are not considered a first-time home buyer if you or your spouse or common-law partner owned a home that you occupied as your principal place of residence during the period beginning January 1 of the fourth year before the year of withdrawal and ending 31 days before your withdrawal. (Dec 31, 2010 or prior for anyone buying in 2015)

However, if you are a person with a disability, or you are buying or building a home for a related person with a disability or helping such a person buy or build a home, you do not have to meet this condition.

In addition, ALL of the following conditions must apply:

• You must enter into a written agreement (Offer of purchase) to buy or build a qualifying home. The agreement may be with a builder, contractor, realtor or private seller.
• You intend to occupy the qualifying home as your principal place of residence. When you withdraw funds from your RRSPs under the HBP, you have to intend to occupy the qualifying home as your principal place of residence no later than one year after buying or building it. Once you occupy the home, there is no minimum period of time that you have to live there.
• Your repayable HBP balance on January 1 of the year of the withdrawal is zero.
• Neither you nor your spouse or common-law partner owns the qualifying home more than 30 days before the withdrawal.
• You are a resident of Canada.
• You buy or build the qualifying home before October 1 of the year after the year of withdrawal.

Your RRSP issuer will not withhold tax from the funds you withdraw if you meet the HBP conditions and complete Form T1036.

You can withdraw a single amount or make a series of withdrawals throughout the same year and January of the following year, as long as the total of your withdrawals is not more than $25,000.

If you buy the home with your spouse or common-law partner, or other individuals, each individual can withdraw up to $25,000 from his or her RRSP, provided each of you meet the HBP conditions.

Your RRSP contributions must remain in the RRSP for at least 90 days before you can withdraw them under the HBP.

Your first repayment is due the second year following the year in which you made your withdrawals.

You have up to 15 years to repay the amount that you withdrew under the HBP. Generally, for each year of your repayment period, you have to repay 1/15 of the total amount you withdrew until the full amount is repaid to your RRSPs.

Len Anderson

Dominion Lending Centres – Accredited Mortgage Professional