Can my spouse use the Home Buyer's Plan for our second house if only I used it for our first?

Gena Katz, a chartered accountant and principal with Ernst and Young, has the answer.

Gena Katz 4 February, 2003 | 2:00PM

Dear Expert:

Both my spouse and I have RRSP accounts. In October 2001, I withdrew $15,000 from my RRSPs for a down payment for the purchase of a new home under the RRSP Home Buyer's Plan. No withdrawals were made from my wife's RRSP account, but we are joint owners of the property. We moved into the house last April.

As we are planning to buy a bigger house, can we make withdrawal from wife's RRSP account for a down payment on the new house under the Home Buyer's Plan? Can I also withdraw $5,000 for buying this new house from my own RRSP, thus making full use of my $20,000 Home Buyer's Plan maximum?

Expert Opinion:

In order to be eligible, you must be considered a first-time home buyer. This is defined as someone (defined as an individual or a married or common-law couple) who has not owned and occupied a home within the past five years. As you and your wife currently live in a purchased home, you are not eligible for a further Home Buyer's withdrawal, despite the fact that you did not make full use of the $20,000 withdrawal limit or that your wife has not made use of any of it.

To find out how much an RRSP contribution may save you, try Morningstar's RRSP Calculator

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Gena Katz

Gena Katz