Worried about delays in your FHSA tax credit? CRA shares an update
Some Canadians who opened a tax-free First Home Savings Account (FHSA) were getting nervous their tax refund would be delayed after the Canada Revenue Agency (CRA) said it encountered some issues.
The FHSA was launched in April 2023 and aims to help Canadians save for a down payment to buy their first home amid soaring housing prices.
Since then, hundreds of thousands of Canadians have opted in for the account, which allows prospective first-time homebuyers to contribute up to $8,000 per year (up to a lifetime limit of $40,000) for their first down payment.
While transfers from your RRSPs to your FHSAs are not tax deductible, the CRA said contributions (up to $8,000 by December 31, 2023) made to your FHSA can be claimed as a deduction on your 2023 income tax return.
If you contributed to your First Home Savings Account (#FHSA) last year, you can claim up to $8,000 in contributions made by December 31, 2023, on your tax return! https://t.co/j3xXy2mNot #CdnTax pic.twitter.com/7MwrF4WXNt
— Canada Revenue Agency (@CanRevAgency) March 23, 2024
However, some Canadians started reporting that they were notified that their tax returns were delayed because of their FHSA contributions.
In an email response to Daily Hive, the CRA said sometimes it can take longer than its two-week service standard to process a tax return.
“As can sometimes be the case with new initiatives at the beginning of tax season, the CRA encountered some processing issues with tax returns that included information related to the First Home Savings Account (FHSA) opened during 2023,” the CRA said. “The issue was identified immediately, and the CRA worked diligently to resolve it as soon as possible.”
The CRA said the issue has since been resolved, and Canadians with an FHSA can now expect their notices of assessment within normal timeframes.
“We regret any inconvenience that this may have caused taxpayers,” reads the statement.
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