Short answer
The general FHSA limit is $8,000 of new participation room per year and $40,000 over a lifetime. Unused room can carry forward, but the carryforward is generally capped at $8,000.
The client’s real concern
A buyer opens an FHSA, misses a year and later assumes they can contribute every unused annual amount at once. That can create an excess contribution and unexpected tax.
What the official rule says
CRA’s calculation starts with $8,000 in the opening year, adds eligible carryforward and respects the $40,000 lifetime limit. Room is shared across all FHSAs; opening several accounts does not multiply it.
What this does not guarantee
Account growth does not use participation room, but contributions and RRSP-to-FHSA transfers generally do. Your CRA-reported room can also be inaccurate if returns or Schedule 15 filings are missing.
A practical Ontario example
Illustration only: Daniel opens in 2025, contributes nothing, then contributes $16,000 in 2026. That may use the 2026 room plus up to $8,000 carryforward. It does not mean he can contribute $24,000 merely because three calendar years are involved.
What I would check before relying on the money
Check the latest CRA participation-room statement before moving money. Coordinate deposits with your accountant and keep statements showing the source and timing for the mortgage file.
- Which program are you using: FHSA, HBP, both, or another source?
- Who owns the account and independently meets that program’s definition?
- When were funds contributed, and when must they be withdrawn?
- Will the full bank, RRSP or FHSA trail satisfy the lender and lawyer?
- What cash remains for the deposit, adjustments, tax, legal costs and emergencies?
Rajiv’s broker perspective
Tax eligibility and mortgage approval are two separate tests. CRA determines whether the withdrawal or credit qualifies under tax law. The lender, mortgage insurer where applicable, and lawyer separately examine ownership, source of funds, borrowed down payment, timing and affordability. I would build one funds-to-close schedule first, then compare suitable A-lender, alternative/B, MIC or private options only if the complete mortgage facts require them. A tax benefit should support the plan—not hide a cash shortfall.
Related: First-Time Buyer Rule Hub · Mortgage Knowledge Centre · Updates & Rules Centre
Will your down payment be ready when the offer becomes firm?
Send Rajiv the purchase timeline, account types, contribution dates, expected withdrawals and available closing cash. He can prepare a practical funds-to-close review and identify questions that need your accountant or lawyer before you commit.