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Thread: RSP withdrawal

  1. #11
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    Quote Originally Posted by OptsyEagle View Post
    I can't see why not except that the taxes owed in that case would only be $2000, not $2,500. The reason the difference is there is because when you pay the withholding tax from the RRSP, you not only pay taxes on the withdraw but you also pay tax on the money you use to pay the taxes. I am not sure if every financial institution is set up to allow this but it would make for smaller withdrawals and therefore smaller amounts of taxes owing.

    By the way can you not make those withdrawals with TDDI yourself online, and perhaps avoid the $25 service charge?
    I've tried to do the transfer on line (I do everything on line) but the message was: "The ‘From’ account you selected does not have any eligible accounts that you can transfer funds to." The "From" was SDRRSP.

    Your suggestion of a lower tax makes it even more worth investigation.


  2. #12
    Senior Member GreatLaker's Avatar
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    Quote Originally Posted by Parkuser View Post
    I've tried to do the transfer on line (I do everything on line) but the message was: "The ‘From’ account you selected does not have any eligible accounts that you can transfer funds to." The "From" was SDRRSP.
    Same here. I don't think TDDI allows any RRSP/RRIF withdrawals do be done online; you must call in.

    Another quirk with TDDI is they charge $25 fee for partial withdrawal from RRSP, but not from RRIF. So if you plan on withdrawing regularly from your RRSP you can set up a RRIF and move money RRSP -> RRIF -> withdrawal. But beware as RRIF has minimum annual withdrawal whereas RRSP does not.
    See here p.6 under Other Registered Account Fees: https://www.td.com/ca/document/PDF/forms/521778.pdf

    $25 is not a lot, but it can buy a 12 pack of cheap beer with a little left over.
    Eschew obfuscation. Espouse elucidation

  3. #13
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    Your suggestion of a lower tax makes it even more worth investigation
    Let us know if you achieve success. I would think most companies will want to take the tax from the RRSP, causing the tax on the tax as I suggested above, because they may not always have another account to take the tax from.

    Another quirk with TDDI is they charge $25 fee for partial withdrawal from RRSP, but not from RRIF.
    That is because, for some reason that I don't understand, the public seem to accept the fee for an RRSP but find it outrageous in a RRIF. I guess it is because, most people do not think they will pay it in an RRSP and would always pay it in a RRIF. All that said, it is the same work and record keeping for the institution in both cases.

    Also, they never call it a fee for an RRSP withdrawal. They all call it a fee for a "partial de-registration". Most Canadians would not know, when they are setting up their accounts, that a partial de-registration is in fact a withdrawal. That is why they call it that and why they get away with it. Not a very customer friendly business practice though.

    Last edited by OptsyEagle; 2017-01-07 at 03:51 PM.

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