When to Repay Your RRSP Home Buyers’ Plan (2026 Rules)

Quick Answer

The Question Every New Homeowner Is Asking

You closed on your first home this year, moved in, and now a small worry keeps surfacing. You pulled money out of your RRSP under the Home Buyers’ Plan to help with the down payment, and you know the Canada Revenue Agency (CRA) will eventually want that money back. But when?

If your first HBP withdrawal happened in 2026, the answer is more generous than the old two-year rule would suggest. The federal government has temporarily extended the repayment grace period to five years for withdrawals made through the end of 2028. That gives you time to plan properly. The sections that follow walk through the timing rules, the annual amount, and the small handful of decisions that quietly determine whether the HBP works for you or against you.

Quick Start: Pick Your Path by Withdrawal Year

Your repayment start date depends on the year you first withdrew funds from your RRSP under the HBP. Match your situation to one of the four paths.

When Repayments Actually Start

Section 146.01 of the Income Tax Act sets up the HBP and defines the repayment obligation as beginning in the second year following the withdrawal. Your withdrawal year is the calendar year the funds actually leave your RRSP, not the year you signed a property closing or filed Form T1036 with your issuer.

Once repayments begin, they continue annually for fifteen years. Each year you either designate a portion of your RRSP contribution as an HBP repayment on Schedule 7, or the missed amount is added to your income.

That baseline is the starting point. It is also the rule most Canadian homeowners still assume applies to them, which is why the current extension often comes as good news.

The 5-Year Grace Period Extension for 2026 to 2028 Withdrawals

The extension was introduced in the 2026 Spring Economic Statement and continues the temporary relief that Budget 2024 first offered for 2022 to 2025 withdrawals. It applies only to first HBP withdrawals made within the 2026 to 2028 window. Withdrawals from January 1, 2029 onward revert to the standard two-year rule.

Here is how the extension translates into calendar years. A 2026 withdrawal has its first minimum repayment designated on the 2031 tax return. A 2027 withdrawal begins its repayment schedule in the 2032 tax year. A 2028 withdrawal, at the outer edge of the extension, has its first minimum repayment on the 2033 return.

Note that the five-year grace does not extend the fifteen-year repayment window itself. It only delays when the clock starts.

How Much You Must Repay Each Year

The minimum annual repayment is your outstanding HBP balance divided by fifteen. For a $60,000 withdrawal, the current maximum per person, that works out to $4,000 per year for fifteen years. A $45,000 withdrawal produces a $3,000 annual minimum. A $30,000 withdrawal produces $2,000.

You can always pay more than the minimum. If you contribute $6,000 to your RRSP in a repayment year and designate the full amount as an HBP repayment on Schedule 7, your outstanding balance drops. The repayment window itself does not shorten; instead, your required minimum in later years is reduced.

HBP repayments are not new RRSP contributions for deduction purposes. The tax deduction was already claimed when you first contributed the money that was later withdrawn. Mixing up the two can inflate an expected refund and create a correction when the CRA issues its reassessment. Our Income Tax 2026 primer shows how a mistaken deduction lands against your marginal rate.

HBP vs FHSA: How Repayment Rules Compare

The Home Buyers’ Plan is often confused with the First Home Savings Account (FHSA), which the federal government introduced in 2023 as a separate first-home savings vehicle. Both can be used on the same qualifying home, and both allow a tax-free withdrawal at purchase.

The most consequential difference is repayment. An HBP withdrawal must be paid back into your RRSP over fifteen years. An FHSA withdrawal for a qualifying home does not need to be repaid. That single fact makes the FHSA structurally simpler, though the trade-off is a smaller contribution ceiling and the requirement to have opened the account for at least the current year.

Readers weighing the FHSA alongside their TFSA may also want to review our TFSA Strategies: How To Maximize Returns.

The Step-by-Step Repayment Roadmap

Once you know your first repayment year, the mechanics are the same every year for fifteen years. Here is the sequence for a reader who took a 2026 HBP withdrawal and needs to designate their first repayment on the 2031 tax return.

1. 1
   Check your HBP balance in CRA My AccountThe CRA also mails the figure on the annual Form T1028 statement with your Notice of Assessment.
2. 2
   Confirm your first repayment yearFor a 2026 withdrawal, the first minimum is due for the 2031 tax year, filed by spring 2032.
3. 3
   Make an RRSP contribution in the repayment year (or first 60 days after)Only contributions inside that window can be designated as an HBP repayment.
4. 4
   Fill out Schedule 7 and enter the designated repayment on line 24600This is the form that tells the CRA a portion of your RRSP contribution counts as an HBP repayment rather than a new deduction.
5. 5
   Attach Schedule 7 to your T1 returnWithout it, the CRA treats the contribution as an ordinary RRSP deduction and your HBP balance does not reduce.
6. 6
   Review the next Notice of AssessmentThe updated T1028 statement will show your new outstanding balance and the next required minimum.

Our Canada Tax Season 2026 primer covers the broader spring filing sequence you will sit inside every year until the schedule closes.

What Happens If You Miss a Repayment

The mechanics are set out in paragraph 146.01(4) of the Income Tax Act. The CRA takes the difference between what you were required to repay and what you actually designated on Schedule 7, and includes it on line 12900 of your T1 return as RRSP income. If your minimum was $4,000 and you designated $2,500, the $1,500 shortfall becomes taxable income for that year.

This outcome is inefficient rather than catastrophic, and it is recoverable. Resuming full designated repayments in the next year restores the schedule.

Common Mistakes to Avoid

A few recurring errors quietly derail HBP repayments. All of them are avoidable with an annual review.

• →Assuming HBP repayments are a new RRSP deduction. They are not. The deduction was already claimed when the funds were first contributed; designating them again on Schedule 7 simply restores the withdrawal.
• →Failing to complete Schedule 7. An RRSP contribution that is not designated on Schedule 7 is treated as an ordinary contribution, and the missed repayment amount becomes taxable income.
• →Trying to repay the HBP into an FHSA. Only RRSP, PRPP or SPP contributions can be designated as HBP repayments.
• →Ignoring the 89-day rule at withdrawal. RRSP contributions made in the 89 days before an HBP withdrawal may not remain fully deductible.
• →Forgetting the annual Notice of Assessment. The CRA publishes your outstanding HBP balance and next minimum every spring, and the T1028 statement is your primary tracking tool.
• →Selling the home and assuming the balance disappears. Selling does not end the schedule. Our Managing Residential Real Estate Tax piece covers what to plan for next.

Frequently Asked Questions

Sources & References

1. The Home Buyers’ Plan — program overview (Canada Revenue Agency)
2. How to repay the amounts withdrawn from your RRSPs under the HBP (Canada Revenue Agency)
3. How to make withdrawals from your RRSPs under the HBP — Form T1036 & 89-day rule (CRA)
4. Schedule 7 — RRSP, PRPP and SPP Contributions and Transfers, and HBP and LLP Activities (CRA)
5. First Home Savings Account (FHSA) — program overview (CRA)
6. Budget 2024 — original 5-year HBP grace period announcement (Department of Finance Canada)
7. Income Tax Act, RSC 1985, c 1 (5th Supp), section 146.01 (Justice Laws Website)