01 Feb 2026 5 min read Tax Guide

HBP Repayment Guide 2026: The "5-Year Holiday" Rule & Tax Traps

Do you owe the CRA money for your home down payment? Discover the 2026 HBP Repayment rules, the new "5-Year Holiday" for recent buyers, and the strategy of intentionally missing a payment.

The Home Buyers' Plan (HBP) is often described as "borrowing from yourself." You withdraw up to $60,000 from your RRSP tax-free to buy a home, and you promise to pay it back over 15 years.

But in 2026, the repayment schedule has split into two very different realities.

Thanks to a massive regulatory change, many recent homebuyers have entered a "Repayment Holiday." While older buyers (pre-2022) must make their annual payments this tax season or face penalties, those who bought homes recently might not owe the CRA a single dime in 2026.

This is the Official 2026 HBP Repayment Guide. We break down the new 5-Year Grace Period, how to calculate your "1/15th" minimum, and the street-level strategy of intentionally defaulting on a payment.

1. The 2026 "Repayment Holiday" (New Rule)

Did you buy a home between 2022 and 2025? If so, put your wallet away.

Historically, HBP repayments started in the second year after the withdrawal. However, to help Canadians cope with high interest rates, the federal government temporarily extended this grace period.

The 5-Year Extension Rule

If you made your HBP withdrawal between January 1, 2022, and December 31, 2025, your repayment period is deferred by an additional 3 years. You now have 5 years before your first payment is due.

2026 Status Check:

Withdrew in 2022: Your first payment is NOT due until 2027. (You pay $0 in 2026).
Withdrew in 2023: Your first payment is due in 2028.
Withdrew in 2024: Your first payment is due in 2029.
Withdrew in 2025: Your first payment is due in 2030.

Strategic Insight: If you fall into this window, you do not need to designate any RRSP contributions to your HBP this year. You can instead prioritize contributing to your First Home Savings Account (FHSA) (if eligible) or filling your TFSA.

2. The "Old Rules" (For Withdrawals Before 2022)

If you bought your home in 2021 or earlier, the holiday does not apply to you. You are on the clock.

For these borrowers, the standard 15-year repayment schedule is active. You must repay 1/15th of the original withdrawal amount into your RRSP every year until the balance hits zero.

The Calculation

Total Withdrawal: $30,000
Repayment Term: 15 Years
Annual Minimum: $2,000 ($30,000 ÷ 15)

The Deadline:

To count for the 2025 tax year (filed in Spring 2026), your repayment contribution must be made by March 2, 2026.

3. Street Strategies: The "Strategic Default"

What happens if you don't pay? Is it a crime? No—it's just math.

Technically, you are not "forced" to repay the HBP. If you miss a payment, the CRA simply treats that missed amount as taxable income. In certain financial situations, "defaulting" is actually the smarter move.

The "Low Income" Strategy

Let’s say your required HBP payment for 2026 is $1,000.

Scenario A (You Pay): You put $1,000 into your RRSP. Your HBP balance decreases. You get no tax deduction for this $1,000 (because you used the deduction years ago when you first contributed).
Scenario B (You Default): You spend the $1,000 on groceries instead. The CRA adds $1,000 to your taxable income for the year.
- The Hack: If you are currently on maternity leave, unemployed, or in a very low tax bracket (earning under $15,000), the tax on that extra $1,000 might be zero or very low (approx. 20%).
- The Result: You effectively kept the money tax-free (or low-tax) and wiped $1,000 off your HBP debt. The only downside is you permanently lose that RRSP contribution room.

The "Double Dip" Trap

Some couples assume that because they are married, they can repay each other’s HBP. This is false.

The Rule: You must repay your own HBP into your own RRSP.
The Trap: If you put $5,000 into a Spousal RRSP, it cannot be designated as an HBP repayment for yourself. It counts as a new contribution for your spouse. Always contribute to your personal RRSP to clear your HBP balance.

4. How to Designate Your Payment

Simply putting money into your RRSP account is not enough. You must "tell" the CRA that the money is for the HBP, or they will assume it is a new contribution.

Step-by-Step for 2026:

Make the Contribution: Deposit the funds into your RRSP before the March 2nd deadline.
File Schedule 7: On your 2025 Tax Return, look for Schedule 7 (RRSP, PRPP and SPP Contributions).
Line 24600: Enter the amount of your contribution you want to designate as an HBP repayment.
- Note: You can designate less than the contribution. For example, if you contributed $5,000 but only owe $2,000 for HBP, you can designate $2,000 on Line 24600 and claim the remaining $3,000 as a fresh tax deduction.

Frequently Asked Questions (FAQ)

Q: Where can I check my HBP balance?

A: Your balance and required payment for 2026 are listed on your Notice of Assessment from last year. You can also view it instantly by logging into the CRA portal. If you are locked out, check our guide on CRA My Account Locked? to restore access.

Q: Can I pay more than the minimum?

A: Yes. You can pay off the entire HBP balance early if you wish. This frees up future RRSP contributions to generate new tax refunds. However, paying extra does not "skip" future years; it simply reduces the remaining balance, which lowers your payments for the remaining years of the term.

Q: What if I withdraw money in 2026?

A: If you buy a home in 2026, the "5-Year Holiday" rule currently does not apply (unless extended by the 2026 Federal Budget). Under current legislation, 2026 withdrawals revert to the standard 2-year grace period, meaning your repayment would start in 2028. Check the First-Time Home Buyers' Tax Credit (HBTC) to ensure you claim your $1,500 rebate after closing.

About the Author

Jeff Calixte (MC Yow-Z) is a Canadian labour market researcher and digital entrepreneur specializing in government benefit data and cost-of-living support. As the founder of CanadaPaymentDates.ca and BetterPayJobs.ca, Jeff helps newcomers, students, and workers navigate the Canadian social safety net—from tracking CRA payment schedules to identifying entry-level employment opportunities.

Sources

Canada Revenue Agency: Home Buyers' Plan (HBP) - Repay funds withdrawn
Department of Finance Canada: Budget 2024 - HBP Repayment Relief

Note

Official 2026 payment dates and benefit amounts are determined by the Canada Revenue Agency (CRA) and provincial governments. While we strive to keep this information current, government policies and schedules are subject to change without notice. All data in this guide is verified against official CRA circulars at the time of publication and should be treated as an estimate. We recommend confirming the status of your personal file directly via CRA My Account or by calling the CRA benefit line at 1-800-387-1193.