Transfers into an FHSA

Before you transfer cash or investments into an FHSA account, it’s important to take into consideration your contribution room.

In the first year you open a FHSA, your contribution room is $8,000 Canadian Dollars (CAD). For the next 4 years you will unlock an additional $8,000 in room every year on January 1, up to the lifetime FHSA contribution limit of $40,000 CAD.

Note that you can only carry forward a maximum of $8,000 CAD in unused FHSA contribution room.

You can learn more about your contribution room for your FHSA account in our comprehensive FHSA 101 article, or on the CRA website.

Explore this section for more information about the transferring into an FHSA from another registered account.

Transfers from an RRSP

In most cases, you’re able to transfer cash or investments from your Registered Retirement Savings Plan (RRSP) to your FHSA without any immediate tax consequences.

This is as long as it’s a direct transfer, (not withdrawn, then re-contributed) and does not exceed your available unused FHSA participation room at the time of the transfer.

Please keep the following points in mind if you choose to transfer from an RRSP to an FHSA:

• Transfers must be made directly from the RRSP, not withdrawn and re-contributed.
• Transfers from RRSPs to FHSAs are not tax deductible.
• Transfers from RRSPs to FHSAs will not restore your RRSP’s contribution room.
• Transfers from RRSPs to FHSAs use up the same contribution room as a new contribution.

Transfers from a Spousal RRSP

Just like transfers from an individual RRSP, transfers from a Spousal RRSP (SRSP) to an FHSA can be made without immediate tax consequences.

All the rules from transferring in an RRSP apply to Spousal RRSPs as well, plus there is one additional rule:

You are not permitted to transfer assets from an SRSP to an FHSA if your spouse or common-law partner contributed any amount to the SRSP in the same year as the transfer, or the previous 2 calendar years.

Transfers from a TFSA

Transfers of cash or assets from a Tax Free Savings Account (TFSA) into an FHSA are treated the same way as a new contribution from a bank account.

As always, make sure you have the contribution room available in your FHSA before starting a transfer of cash or investments from your TFSA.

Please note that this type of transfer will temporarily decrease your TFSA contribution room for the year, as it constitutes a withdrawal from your TFSA.

Explore this article for more information about transferring out of a TFSA.

Transfers of cash or investments from a Margin account into an FHSA are treated the same way as new contributions.

You’re able to transfer cash or investments to your FHSA from your Margin account as long as you don’t exceed the maximum FHSA contribution room available to you.

Explore this article for more information on transfers out of Margin accounts.

Transfers of cash or investments from one FHSA to another FHSA can be made without immediate tax consequences as long as:

• Both FHSAs are held by the same individual.
• It’s a direct transfer (not a withdrawal and re-contribution).

Transfers from one FHSA to another will not reduce your unused FHSA contribution room.

When you request to transfer cash into your FHSA account, this request can be made in either Canadian (CAD) or U.S. dollars (USD) since all Questrade accounts support both currencies.

However, a contribution into an FHSA denominated in USD will be calculated at the CAD-equivalent amount for tax reporting purposes (at the time of the deposit).

Before you request to transfer USD cash into an FHSA, please double check that the CAD-equivalent amount of your contribution does not exceed your contribution limit.

Learn more about how to request a cash transfer between Questrade accounts in this article.

You’re also able to request a direct transfer of qualified investments* from most other account types into your FHSA. Please keep in mind that these transfers will be counted as contributions. (Except FHSA to FHSA transfers)

The contribution amount is represented by the fair market value (FMV) of the investment on the date of the transfer request, and you have different options as to which price is considered the FMV depending on the type of investment.

Please speak to your accountant or tax provider to assist you with choosing the best available price for your personal tax situation.

*Qualified investments as defined by the CRA include: cash, guaranteed investment certificates (GICs), government/corporate bonds, exchange traded (ETFs) and mutual funds, securities (stocks) listed on a designated stock exchange but not real property.

To indicate which price you’d like Questrade to use for determining your transfer amount, you can leave a comment on the request after it has been placed.

Simply click the “Request history” tab, and click “Add comment” for the request indicating which price you’re using.

Note: The information in this blog is for educational purposes only and should not be used or construed as financial or investment advice by any individual. Information obtained from third parties is believed to be reliable, but no representations or warranty, expressed or implied, is made by Questrade, Inc., its affiliates or any other person to its accuracy.