FHSA taxes payable, assessments and reassessments

You have to file a return and pay the taxes owing when you have taxes payable on your first home savings account (FHSA). If you do not file the return on time, the Canada Revenue Agency (CRA) may assess your taxes owing based on our records, and send you a notice of assessment.

You may contact the CRA if you disagree with the notice of assessment or notice of reassessment that you receive about your FHSAs.

On this page

• Tax payable on FHSAs
• FHSA payment of taxes
• FHSA assessments and reassessments

Tax payable on FHSAs

In certain circumstances, there might be taxes payable with respect to your FHSA. For more information on when or, how these taxes are payable, and by whom, go to:

• Tax payable on excess FHSA amount
• Tax payable on non-qualified investments
• Tax payable on prohibited investments
• Refund of taxes paid on non-qualified or prohibited investments
• Tax payable on an advantage

Where one or more of FHSA taxes are payable, an RC728, First Home Savings Account (FHSA) Return must be completed and filed by June 30 of the year following the calendar year in which the tax arose.

FHSA payment of taxes

Most FHSA holders have no tax payable related to their FHSAs, and no FHSA return has to be filed.

However, when FHSA taxes are applicable for a year, you have to file an RC728 return. You have to file this return and pay the taxes owing no later than June 30 after the end of the year in which there are FHSA taxes payable.

If you do not file by this date, a penalty and interest charge will apply, and the CRA will continue to charge interest until you pay the balance owing.

Exception to the due date:

When a due date falls on a Saturday, Sunday, or public holiday recognized by the CRA, an exception to the due date will apply. For more information, go to Filing due dates for the 2023 tax return.

Completing your RC728 - Schedule A, Excess FHSA Amounts

You must complete the RC728 - Schedule A, Excess FHSA Amounts if you have excess FHSA amounts and attach the completed schedule to your RC728 return.

Section 1 – Chart to calculate your excess FHSA amounts

Fill out this chart to calculate the highest excess FHSA amount for each month. Refer to the instructions below to correctly fill out the chart.

Instructions:

1. Report all amounts in Canadian dollars.
2. Enter information about all your FHSA transactions for 2023 in chronological order (first transaction in first row, second transaction in second row, etc.). If you completed more than one transaction on the same day, fill out a separate line for each transaction. Attach a separate sheet if you need more space.
3. You must fill out each month beginning in the month when you made your first transaction, even if you do not have any transactions in the subsequent months. For example, if your first transaction happened in May, you must fill out months May to December even if you do not have any transactions from June to December.
4. Enter the excess FHSA amount before the transaction in Column A. On your first transaction, enter $0. For all subsequent transactions, enter the amount from Column H of the previous transaction.
5. Enter all your contributions to your FHSAs and transfers from your registered retirement savings plans (RRSPs) to your FHSAs for each month in Column B.
6. Add the amounts in Column A and Column B (A + B) and enter the result in Column C.
7. Enter your unused FHSA participation room before the transaction in Column D. On your first transaction, enter $8,000. For all subsequent transactions, enter the amount from Column G of the previous transaction. If the amount from Column G of the previous transaction is a negative amount, enter $0.
8. Subtract the amount in Column D from the amount in Column C (C - D) and enter the result in Column E. If the result is negative, enter $0.
9. Enter all your taxable withdrawals, designated amounts, or amounts deemed received on your FHSA cessation for each month in Column F. Also include any portion of the additional amount directly transferred from your FHSA to your RRSP or registered retirement income fund (RRIF) that exceeds the total fair market value (FMV) of all the property held in your FHSAs at the time of the transfer minus any remaining excess FHSA amount at the time of the transfer.
   • Do not include qualifying withdrawals, FHSA to RRSP or RRIF transfers (other than the amount described above) or any amount included in income that is pledged as security for a loan.
10. Calculate the result of the amount in Column D minus the amount in Column C plus the amount in Column F (D - C + F) and enter the result in Column G. This is the unused FHSA participation room after the transaction. This result can be a negative amount.
11. Enter your excess FHSA amount as of the date of the transaction in Column H. Subtract the amount reported in Column E from the amount in Column F (E - F). If the result is negative, enter $0.
12. If, in the year of death, the deceased holder has an excess FHSA amount, the legal representative of the deceased holder must fill out all columns for each month up until the date of the deceased holder’s death.
13. If, at the time of death of the holder of an FHSA, the holder has an excess FHSA amount and you are the successor holder of one of the deceased holder’s FHSAs, you must enter, as a contribution in Column B, on the first day of the month following the holder’s date of death , the amount of the deceased holder’s excess FHSA amount at the time of the deceased holder’s death minus the FMV of all of the property of the deceased holder’s FHSAs at the time of their death, which you did not become the successor holder of.
14. Fill out all columns for each transaction.

Section 2 – Calculation of tax on excess FHSA amount

Enter the tax on the highest excess FHSA amount for each month from Column H of the corresponding month below:

Line 1. Enter the tax on the highest excess FHSA amount for the month of April from line 1 of Section 1.

Line 2. Enter the tax on the highest excess FHSA amount for the month of May from line 2 of Section 1.

Line 3. Enter the tax on the highest excess FHSA amount for the month of June from line 3 of Section 1.

Line 4. Enter the tax on the highest excess FHSA amount for the month of July from line 4 of Section 1.

Line 5. Enter the tax on the highest excess FHSA amount for the month of August from line 5 of Section 1.

Line 6. Enter the tax on the highest excess FHSA amount for the month of September from line 6 of Section 1.

Line 7. Enter the tax on the highest excess FHSA amount for the month of October from line 7 of Section 1.

Line 8. Enter the tax on the highest excess FHSA amount for the month of November from line 8 of Section 1.

Line 9. Enter the tax on the highest excess FHSA amount for the month of December from line 9 of Section 1.

Add the amounts from line 1 to line 9 and enter it on Line 10. This is the tax on your excess FHSA amount. Enter this amount on line 1 in Step 2, Part A of your RC728 return.

FHSA assessments and reassessments

If an FHSA return is required but has not been filed, we may use information provided by your issuers to calculate any tax payable by you.

Once the CRA has assessed your FHSA return, the CRA will send you a notice of assessment showing the amount of taxes payable, and any related penalties and interest.

Once your FHSA return has been assessed, the CRA may reassess your return and send you a notice of reassessment at any time within three years of the date of your notice of assessment.  The CRA can do this in either of the following circumstances:

• You bring to the CRA’s attention new information or an error in your return or assessment
• The CRA finds an error during a review of your return or a return related to yours

What to do if you disagree with your FHSA notice of assessment or reassessment

If you disagree with the assessment or reassessment of your FHSA taxes payable, you may ask for an explanation by calling our individual tax enquiries line at 1-800-959-8281.

Also, you can ask for an adjustment by sending a signed letter to the FHSA Processing Unit at one of the addresses listed below:

If your residential address is based in Ontario, Prince Edward Island, Newfoundland and Labrador, Yukon, Nunavut, Northwest Territories and the following Quebec cities: Montréal, Québec City, Laval, Sherbrooke, Gatineau, and Longueuil, send the signed letter to:

Canada Revenue Agency
Sudbury Tax Centre
FHSA Processing Unit
Post Office Box 20000, Station A
Sudbury ON P3A 5C1

If your residential address is based in Manitoba, Saskatchewan, Alberta, British Columbia, Nova Scotia, New Brunswick and the remaining areas of the province of Quebec not listed under the Sudbury Tax Centre, send the signed letter to:

Canada Revenue Agency
Winnipeg Tax Centre
FHSA Processing Unit
Post Office Box 14000, Station Main
Winnipeg MB R3C 3M2

If you send the CRA a letter, include all necessary documents to support your request (if you did not already provide them) and state the changes you want the CRA to make. Also, give the CRA your social insurance number, address, phone number, and the tax year(s) you want the CRA to adjust.

You can also register a formal dispute within 90 days of the date of the notice of assessment or reassessment. For more information or to register a formal dispute, go to Objections, appeals, disputes, and relief measures.

Requesting a waiver or cancellation of your FHSA taxes

The Minister may use discretion to waive or cancel all or part of the taxes payable on excess FHSA amounts if:

• your excess FHSA amounts on which the tax is based arose due to a reasonable error
• you have taken steps or are taking immediate steps to remove the excess FHSA amount, including any income that is reasonably attributable to it, from your FHSAs

The Minister may also waive or cancel all or part of the taxes payable by you on the non-qualified or prohibited investments held in your FHSAs, as well as advantages, if it is determined that it is fair to do so after reviewing all factors, including:

• the tax arose because of a reasonable error
• the extent to which the transaction or series of transactions that gave rise to the tax also gave rise to another tax under the Income Tax Act
• the extent to which payments have been made from the FHSAs

To request a waiver or cancellation of the taxes payable on your excess FHSA amount only, you need to fill out Form RC729, Request for Waiver or Cancellation of Tax on your Excess FHSA Amount. Submit all relevant documents that support your request for the waiver or cancellation of tax such as copies of your FHSA transaction statements which show the dates when the excess FHSA amount occurred, as well as the dates when you removed your excess FHSA amount. Also include copies of any document that would support the explanation of the reasonable error that caused the excess FHSA amount.

To request a waiver or cancellation of the taxes payable on your non-qualified or prohibited investments, as well as advantages, you need to write a letter explaining why the tax liability arose, and why it would be fair to cancel or waive all or part of the tax.

Send the completed form, signed letter, and any supporting documents to one of the following tax centres:

If your residential address is based in Ontario, Prince Edward Island, Newfoundland and Labrador, Yukon, Nunavut, Northwest Territories and the following Quebec cities: Montréal, Québec City, Laval, Sherbrooke, Gatineau, and Longueuil, send your request to:

Canada Revenue Agency
Sudbury Tax Centre
FHSA Processing Unit
Post Office Box 20000, Station A
Sudbury ON P3A 5C1

If your residential address is based in Manitoba, Saskatchewan, Alberta, British Columbia, Nova Scotia, New Brunswick and the remaining areas of the province of Quebec not listed under the Sudbury Tax Centre, send the request to:

Canada Revenue Agency
Winnipeg Tax Centre
FHSA Processing Unit
Post Office Box 14000, Station Main
Winnipeg MB R3C 3M2

You can also send the completed form, signed letter, and any supporting documents to the FHSA Processing Unit by fax at 418-566-6335.

Cancel or waive penalties and interest

The Canada Revenue Agency (CRA) administers legislation, commonly called the taxpayer relief provisions, that gives the CRA discretion to cancel or waive penalties and interest when taxpayers cannot meet their tax obligations due to circumstances beyond their control.

The CRA's discretion to grant relief is limited to any period that ended within 10 calendar years before the year in which a relief request is made.

For penalties, the CRA will consider your request only if it relates to a tax year or fiscal period ending in any of the 10 calendar years before the year in which you make your request. For example, your request made in 2024 must relate to a penalty for a tax year or fiscal period ending in 2014 or later.

For interest on a balance owing for any tax year or fiscal period, the CRA will consider only the amounts that accrued during the 10 calendar years before the year in which you make your request. For example, your request made in 2024 must relate to interest that accrued in 2014 or later.

Taxpayer relief requests can be made online using the CRA's My Account, My Business Account (MyBA) or Represent a Client digital services:

• My Account: After signing in, select “Accounts and payments,” then “Request relief of penalties and interest.”
• MyBA or Represent a Client: After signing in, on the overview page, select the appropriate program from the left menu and then select the account. Finally, select “Request relief of penalties and interest” from the right menu.

You can also fill out Form RC4288, Request for Taxpayer Relief - Cancel or Waive Penalties and Interest, and send it in one of the following ways:

• online using My Account: select “Submit documents” from the left menu; then select "Submit documents" again at the bottom of the next page; and then follow the instructions
• online using MyBA or Represent a Client: for a new case select “Submit documents” from the left menu; then select "No case or reference number?"; and finally, select "Request taxpayer relief - cancel or waive penalties and interest (Form RC4288)"
• by mail to the designated office, as shown on the last page of the form, based on your place of residence

For information on the “Submit documents online” service, go to Submit documents online.

For more details on the required supporting documents, relief from penalties and interest and other related forms and publications, go to Cancel or waive penalties and interest at the CRA.