Overview
When you take money out of your First Home Savings Account (FHSA), there are rules and processes that the Canada Revenue Agency (CRA) requires us to follow. Also, the reason you withdraw from your FHSA impacts how the CRA treats your withdrawal for income tax purposes.
Taxable (non-qualifying) withdrawals are withdrawals for purposes other than to purchase your first home. Your withdrawn amount is subject to income tax withholding.
If you over-contributed to your FHSA, you can consider making a designated withdrawal or transfer to remove the excess amount without paying withholding tax.
Make a taxable FHSA withdrawal
Follow these steps to make a non-qualifying withdrawal:
- Log in to the Wealthsimple mobile app
- Select an FHSA
- Tap Move money
- Tap Withdraw
- Select the FHSA to withdraw from
- Tap Next
- Choose It's for another reason
- Tap Next
- Follow the prompts to make a non-qualifying withdrawal from your FHSA.
Withholding tax thresholds
We'll automatically deduct the holding tax from your withdrawal and pay it to the government. The amount of withholding tax we send depends on which province you live in.
|
If you withdraw: |
Withholding tax rate (excluding Quebec): |
Withholding tax rate (Quebec residents): |
|
Up to $5,000 |
10% |
19% (5% Federal + 14% Provincial) |
|
Between $5,001 and $15,000 |
20% |
29% (10% Federal + 19% Provincial) |
|
More than $15,001 |
30% |
34% (15% Federal + 19% Provincial) |
Withdrawal timelines
The time it takes to receive your withdrawn funds depends on:
- the settlement period for any new deposits (5 business days) and
- the withdrawal timeline for your specific account type (managed or self-directed). Learn more about withdrawal timelines.
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