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The First Home Savings Account (FHSA) is a registered plan in Canada designed to help individuals save for their first home tax-free. To be eligible for an FHSA, individuals must be at least 18 years old, have a Social Insurance Number, and have not owned a home in the current year or the previous four calendar years. The FHSA has a lifetime contribution limit of $40,000, with an annual limit of $8,000. Unused contribution room can be carried forward to the next year. Contributions to an FHSA are tax-deductible and earnings are tax-free. The funds in an FHSA must be used by the 15th year after opening the account or the year the account holder turns 71, whichever comes first. If the funds are not used for a qualifying home purchase, they can be transferred to an RRSP without impacting contribution room.

Several financial institutions in Canada offer FHSAs, including BMO, CIBC, Desjardins, EQ Bank, Hubert Financial, Fidelity, Meridian, National Bank, Qtrade, Questrade, RBC, Saven Financial, Scotiabank, Sun Life, TD, and Wealthsimple. Each institution has different options for opening and managing an FHSA, and some offer promotional offers and savings rates on cash holdings. When choosing an FHSA, individuals should consider factors such as the type of service offered, investment options, fees, and interest rates on cash.

Our calculator is designed to be user-friendly. Simply provide some information about your income, FHSA contributions, and other relevant details. In a few simple steps, you'll get an accurate estimate of your tax return. This allows you to plan your finances accordingly and maximize your tax savings. You're in good hands with our intuitive tool.

Opening an FHSA before the end of 2023 comes with a significant financial advantage. By opening your account before this date, you'll have the opportunity to contribute $8,000 for the year 2023 and another $8,000 for the year 2024, totaling $16,000 in contribution room. This allows you to maximize your tax-advantaged contributions over two consecutive years, which can help optimize your tax savings and grow your investments more effectively. Don't miss out on this opportunity to prudently plan your financial future by taking full advantage of the maximum contribution room.

The annual contribution limit for FHSA (Flexible Home Savings Account) accounts is set by the government and may vary from year to year. It's important to check the current limit, but as of 2023, the maximum annual contribution limit is $8,000. This means you can contribute up to $8,000 per year to your FHSA account to take advantage of tax benefits and save for your first home purchase. Be sure to stay informed about any changes to the contribution limit to make the most of your savings strategy.