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TFSA, RRSP or FHSA: what are the differences?

Three registered accounts, three different logics. Here is what sets them apart, with the official 2026 figures.

Updated on October 30, 2026 · 2 min read

At a glance

TFSA

Contribution deductible from income
No
Withdrawal taxable
No, generally
A withdrawal gives back room
Yes, the next year
2026 annual limit
$7,000

RRSP

Contribution deductible from income
Yes
Withdrawal taxable
Yes, generally
A withdrawal gives back room
No
2026 annual limit
$33,810

FHSA

Contribution deductible from income
Yes
Withdrawal taxable
No, if the withdrawal qualifies
A withdrawal gives back room
No
2026 annual limit
$8,000

The RRSP limit is a maximum: your room also depends on your income from the previous year.

The TFSA

Contributions are not deductible, but interest, dividends and capital gains earned in the account are generally tax-free, even when you withdraw them.

If you live in Canada, your room builds up from the year you turn 18. Unused room carries forward, and an amount you withdraw is added back to your room on January 1 of the following year.

A contribution above your room is taxed every month the excess stays in the account. Learn more: how to work out your TFSA room.

TFSA roomHow much you can still put in your TFSA, from your birth year and residence.

The RRSP

Contributions reduce your taxable income. Income stays sheltered from tax while it is in the plan, and amounts you withdraw are generally taxable.

Your new room equals 18% of your earned income from the previous year, up to the year's limit. Contributions made until March 1, 2027 can be deducted for 2026. Details: how RRSP room is calculated.

RRSP roomHow much you can still put in your RRSP, from your notice of assessment.

The FHSA

It is used to save to buy or build a first home. Contributions are deductible, and a qualifying withdrawal to buy a first home is not taxable.

The limit is $8,000 per year, with a lifetime maximum of $40,000. Among other conditions, you must live in Canada and be a first-time home buyer as defined by the CRA. Details: how the FHSA works.

FHSA roomHow much you can still put in your First Home Savings Account this year.

What comes into play when choosing

  • Your goal: buying a first home, retirement, or savings you want to withdraw tax-free.
  • Your income today and the income you expect when you withdraw, since the RRSP and FHSA give a deduction now.
  • The room available in each account.

You can use several accounts at the same time. This guide explains the rules; for a decision that takes your whole situation into account, a qualified professional can help.

Open the calculator

TFSA roomHow much you can still put in your TFSA, from your birth year and residence.RRSP roomHow much you can still put in your RRSP, from your notice of assessment.FHSA roomHow much you can still put in your First Home Savings Account this year.

Related guides

Official sources

Educational estimate — not advice.

Educational estimates only — not personalized tax, legal or financial advice. Confirm with official sources or a qualified professional.