Minister Miller highlights new tax-free first home savings account that helps Canadians reach their goals of home ownership faster
The Honourable Marc Miller, Minister of Immigration, Refugees and Citizenship, shared how the new tax-free First Home Savings Account is available and helping put home ownership back within reach of Canadians across the country.
The new tax-free First Home Savings Account is a registered savings account that helps Canadians become first-time home buyers by contributing up to $8,000 per year (up to a lifetime limit of $40,000) for their first down payment within 15 years.
Key features of the tax-free First Home Savings Account include:
- Registered Savings Account: The First Home Savings Account is a registered savings account that enables Canadians to become first-time homebuyers by contributing up to $8,000 per year, with a lifetime limit of $40,000 for their first down payment within 15 years.
- Tax Deductible Contributions: Contributions made to the First Home Savings Account are tax-deductible on annual income tax returns, similar to a Registered Retirement Savings Plan (RRSP), providing an incentive for Canadians to save for their first home.
- Tax-Free Withdrawals: Similar to a Tax-Free Savings Account, withdrawals from the First Home Savings Account for the purpose of purchasing a first home, including any investment income on contributions, are non-taxable. This means that contributions and withdrawals are tax-free.
- Availability: Financial institutions have been offering the First Home Savings Account since April 1, 2023. Currently, it is available at 7 financial institutions, with more expected to offer it in the near future.
In addition to the First Home Savings Account, the government is taking steps to address housing affordability by focusing on the labor market. Measures include:
- Expanding Permanent Residence Eligibility: The government has made workers with experience in homebuilding occupations eligible for permanent residence through Express Entry, recognizing the importance of skilled workers in the housing sector.
- Trades-Specific Express Entry Draw: A trades-specific Express Entry draw on August 3, 2023, invited 1,500 candidates with experience in trades occupations to apply for permanent residence in Canada. This initiative aims to address crucial gaps in the labor shortage and bring in talent to expedite home construction.
Through these combined efforts, the federal government is not only supporting Canadians in their pursuit of home ownership but also addressing labor shortages and fostering talent acquisition to boost the housing industry.
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