Page 9 - September 2022 News On 7

WHAT DOES THE FIRST HOME
SAVINGS ACCOUNT MEAN FOR NEW

BUYERS?
In the 2022 Federal Budget, Deputy Prime
Minister of Finance, Chrystia Freeland
announced a new tax-free plan to help more
Canadians buy their first home and get into the
housing market – the First Home Savings
Account (FHSA). Here are some of the basics you
need to know if you plan to take advantage of
this opportunity: Eligibility requirements - To
be eligible to open an FHSA, a contributor must:
be a resident of Canada, at least 18 years old and
not have lived in a home they own in the year
that the account is opened, or the previous four
years. Making contributions - Contributions to
the plan will be tax deductible (like RRSP
contributions), and growth inside an FHSA will
be tax deferred (similar to RRSP and TFSA
earnings). Eligible contributors will be able to contribute up to $8,000 per year to the First Home Savings Account (FHSA),
up to a lifetime maximum of $40,000.
Using the funds - Account holders will have 15 years from account opening to use the funds in the FHSA towards the
purchase of a home. After making a tax-free withdrawal towards the purchase of a home, the account must be closed within
one year, and an FHSA cannot be opened in the future. Withdrawals for any purpose other than purchasing a first home will
be fully taxable in the year of withdrawal.
Something to note, is that the FHSA cannot be used along with the RRSP Home Buyers' Plan (HBP). The federal government
has not yet announced when in 2023 the FHSA will be available or the finer details such as qualifying investments and
naming beneficiaries on this account.
Bottom Line
Both the FHSA and HBP are effective strategies to use if you are savings for your first home. Which one you choose really
depends on which strategy will work best for you and help you achieve your goals.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor.
Submitted by Scott Foster

QUEENSBOROUGH COMMUNITY CENTRE
“Art With Alex” program! Thanks to Jamie Grant and Tory Byers for
the use of the Orange Hall, and of course to artist Alex Bulzan for
teaching these budding artists!