RRSP withdrawal rules
October 2022 – 15 min read
You may take money out of your RRSP any time, but you’ll pay tax if you do
You may withdraw money for your education or to buy your first home without paying tax
You have options to withdraw money from your RRSP for your retirement.
When you can withdraw money from your RRSP
As long as your RRSP isn’t a locked-in plan, you can take money out of your RRSP any time.
However, any amount you withdraw will be included as income for tax purposes. You’ll also pay withholding tax on the amount you withdraw (based on the amount of the withdrawal). You’ll also lose the contribution room you originally used to make your RRSP contribution.
For these reasons, and the fact you may be losing out on positive effect of compounding on your investment returns, taking money out of your RRSP before retirement can really impact your savings. It’s best to consult with your advisor before doing so.
Now that you know more about withdrawing money from your RRSP, why not meet with your advisor to:
Determine other sources of retirement income and what your total income might be in retirement
Which strategy for withdrawing money from your RRSP best meets your needs
The information provided is based on current laws, regulations and other rules applicable to Canadian residents. It is accurate to the best of our knowledge as of the date of publication. Rules and their interpretation may change, affecting the accuracy of the information. The information provided is general in nature and should not be relied upon as a substitute for advice in any specific situation. For specific situations, advice should be obtained from the appropriate legal, accounting, tax or other professional advisors.