RRSP withdrawals for HBP

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Oct 4th, 2020 8:21 pm

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Oct 4th, 2020 11:40 am

KillmeSlowly [OP]: Newbie; Aug 11, 2015; 65 posts; 36 upvotes; Toronto, ON

Oct 4th, 2020 11:40 am

RRSP withdrawals for HBP

Hi -

My wife and I are both first time home buyers. As per the guidelines, I understand that both of us can withdraw upto $35,000 from RRSP to use as a downpayment for the house.

My wife, since she moved to Canada 3 years ago doesn't have the $35k limit in her RRSP but I have enough to make up for a combined $70k. One of my friends told me that I could withdraw more from my RRSP as long as the combined is $70k for us, but I am a bit skeptical about how it would work.

Our combined RRSP limit is over $70k but my wife's is about $15k. So, I am looking for the best way to take advantage of HBP to withdraw money for my downpayment. Any advice?

P.S: Sorry if the questions are silly and very basic but I couldn't find answers online.

4 replies

Oct 4th, 2020 2:15 pm

NoamChimsky: Member; Aug 19, 2015; 226 posts; 208 upvotes; Ajax, ON

Oct 4th, 2020 2:15 pm

Account has to be in their name.

You can't withdraw, say, $55,000 from your accounts and $15,000 from hers to total $70,000.

Also remember that any contributions under 90 days can't be withdrawn. That always bites people in the ass.

+1

Oct 4th, 2020 4:35 pm

KillmeSlowly [OP]: Newbie; Aug 11, 2015; 65 posts; 36 upvotes; Toronto, ON

Oct 4th, 2020 4:35 pm

NoamChimsky wrote: ↑ Account has to be in their name.

You can't withdraw, say, $55,000 from your accounts and $15,000 from hers to total $70,000.

Also remember that any contributions under 90 days can't be withdrawn. That always bites people in the ass.

Thanks for your reply. Can I open a Spousal RRSP under her name, I do the contributions and then use it to withdraw when we are putting the downpayment? Does that work?

Oct 4th, 2020 6:04 pm

senasena: Deal Addict; Feb 19, 2019; 1569 posts; 2355 upvotes; Stouffville ON

Oct 4th, 2020 6:04 pm

KillmeSlowly wrote: ↑ Thanks for your reply. Can I open a Spousal RRSP under her name, I do the contributions and then use it to withdraw when we are putting the downpayment? Does that work?

Yes, if it makes sense you can open a spousal rrsp, you take the deduction but when the funds are drawn towards the HBP you can withdraw up to $35K from your rrsp, and she can withdraw up to $35K from the spousal rrsp you set up for her, this way you can have up to $70K towards the downpayment.

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+1

Oct 4th, 2020 8:21 pm

NoamChimsky: Member; Aug 19, 2015; 226 posts; 208 upvotes; Ajax, ON

Oct 4th, 2020 8:21 pm

Right you can use a spousal RRSP provided that you have the contribution room but I believe your spouse will need to repay the HBP withdrawal.

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