Home Buyers’ Plan repayment for Norfolk County buyers: what to budget

When do you start repaying the Home Buyers’ Plan?

Repayment starts later than you may think.

The Canada Revenue Agency (CRA) says it starts in the fifth year after the year of your first withdrawal. That applies to first withdrawals from January 1, 2022 to December 31, 2028.

The later start for 2026, 2027 and 2028 withdrawals is law. Parliament passed it in June 2026.

Did you withdraw before 2022? Then your repayment started in the second year after your withdrawal.

Five years feels far away, so it’s easy to forget about the repayment by the time it starts.

Here’s one more date to watch. Say you make your first withdrawal and buy in 2026, and you choose a five-year mortgage term, the length of your mortgage contract. It would end in 2031.

That’s the same year your repayments start. Your mortgage payment could change at renewal just as this new cost begins.

How much do you repay each year?

You have up to 15 years to repay. Each year, the CRA divides what you still owe by the years you have left. That’s your required amount for the year.

The repayment rules are federal. They work the same way in Norfolk County as in the rest of Canada. So let’s use a local price to see what they mean for you.

The middle sale price, or median, for single detached homes in Norfolk County was $585,000 in the third quarter of 2026. The minimum down payment at that price is $33,500. So a $30,000 withdrawal from your RRSP would cover most of it.

The repayment comes later. It depends only on what you withdrew, not on the price of the home.

$30,000 divided by 15 years is $2,000 a year. That’s a monthly savings target of about $167.

Buying with a partner? You each have your own repayment. If you both took $30,000, your household repays $4,000 a year, or about $334 a month.

The most one person can withdraw is $60,000. These are starting amounts. The CRA sets a new yearly amount each year from what you still owe. It doesn’t set a monthly one. The monthly targets are my own math: the yearly amount divided by 12, rounded up to the next dollar.

You can repay more in any year. Then your required amounts for later years go down. You can also start before you have to, which lowers your first required amount.

How do you make the repayment?

You don’t send a payment to the CRA. Your lender isn’t involved either.

You put money into your own RRSP. You can do it during the year or in the first 60 days of the next year. Then, on your tax return, you tell the CRA that the money is an HBP repayment. You do that on a form called Schedule 7.

Two things to know:

• HBP repayments aren’t tax-deductible. You can claim a tax deduction for eligible regular RRSP contributions, which lowers the income you pay tax on. You can’t claim one for money you count as an HBP repayment.
• It doesn’t use up your RRSP room. There’s a limit on what you can add to your RRSP for regular retirement savings. An HBP repayment doesn’t use any of it.

Where do you find your number? Each year, after it reviews your tax return, the CRA sends you a summary called a notice of assessment. Your HBP statement comes with it. It shows what you still owe and what to repay next year. You can also see it in your CRA account online.

I’m a mortgage agent, not a tax advisor. For questions about your tax return, ask the CRA or an accountant.

What happens if you repay less?

You have to report the amount you didn’t repay as income on your tax return.

Say your required amount is $2,000 and you repay $1,200. You report the other $800 as income for the year. That may mean more tax to pay.

Skip the whole repayment, and the full $2,000 counts as income.

The amount you report as income also reduces your remaining HBP balance. You still have to repay in the years that follow.

How do you fit the repayment into your budget?

Plan for it now, before you pick your mortgage payment.

A pre-approval is a lender’s estimate of the most you may be able to borrow. It doesn’t tell you what’s comfortable. The Financial Consumer Agency of Canada suggests looking at homes in a lower price range so you still have money for other costs.

Add your HBP repayment to your budget too. Here’s how.

1. Estimate your number. Divide what you plan to withdraw by 15, then by 12. Already in the plan? Divide the yearly amount on your CRA statement by 12.
2. Test your budget with it. Work out your mortgage payment with the mortgage payment calculator. Then add your monthly HBP amount, property tax, heat and other bills. Is the total still comfortable?
3. Save it monthly once repayment starts. Set up an automatic transfer to your RRSP each month. Moving $167 a month is easier than finding $2,000 at tax time. Check that your transfers add up to your yearly amount.
4. Check your CRA statement each year. It shows your next required amount.

Here’s what the test in step 2 can look like. These are example amounts for the main housing costs, not quotes. Replace each one with your own, and add upkeep and your other bills.

You’ll need cash for closing costs too, so count those before you decide how much of your savings goes to the down payment.

Do you repay an FHSA withdrawal too?

No. The CRA says you don’t need to repay an FHSA withdrawal that meets its rules for buying a first home.

You can use both for the same home if you meet the conditions for each. So if you have savings in both, only the RRSP money comes with a repayment.

See how the two work on my page for first-time home buyers.

Using or planning to use the Home Buyers’ Plan for a home in Norfolk County? Tell me what you withdrew or expect to withdraw. I’ll help you estimate your mortgage payment and add your separate HBP repayment, so you can see whether the total fits your budget. Our first conversation is free.