An RRSP-to-FHSA transfer can move existing retirement savings toward a first home without first withdrawing them as cash. The ordinary tax-deferred route is a direct transfer between the institutions, within your unused FHSA participation room. It is not a new deductible FHSA contribution.
Count cash contributions and transfers together
Suppose your available FHSA participation room for the year is $8,000 and you have already contributed $2,000 across your FHSAs. With no other adjustments, $6,000 remains for further contributions and RRSP transfers combined. A $5,000 direct transfer would leave $1,000, not another $8,000 at a second bank. This is a hypothetical room calculation, not an account recommendation.
Use your account records as well as CRA's calculation; a recent transaction may not yet appear there. Opening a second FHSA does not create a second allowance. CRA participation-room guidance.
Give the institution transfer instructions
Ask for a direct RRSP-to-FHSA transfer and identify both accounts. Form RC720 records this direction; an institution may use its own acceptable transfer documents. Keep its confirmation and compare the completed amount with your room calculation.
The transferred amount cannot be deducted as an FHSA contribution in any year. It also does not restore RRSP deduction room. An existing RRSP excess is not automatically corrected by moving money to an FHSA. Spousal RRSPs and unusual account circumstances need their specific rules checked before transfer. CRA transfer conditions.
Withdrawing and depositing is a different route
If you withdraw from the RRSP yourself and then deposit into the FHSA, the RRSP withdrawal is generally taxable income. The new FHSA contribution uses room and may be deductible if it meets the contribution rules. That possible deduction does not turn the two transactions into a direct transfer or guarantee that their tax effects cancel. CRA's deduction rules.
Decide what happens after the transfer
If you plan to buy, check the separate qualifying-withdrawal requirements before requesting the money. Moving funds into the FHSA does not itself qualify the later home withdrawal. If the decision is instead to close an unused FHSA, the reverse FHSA-to-RRSP/RRIF process follows different room rules.
Canadian rules checked November 2, 2026.
