Income Splitting: If you earn more than your spouse or common-law partner, contributing to a spousal RRSP may help reduce the total amount of tax you pay. Financing your First Home or Education: You can withdraw money from your RRSP without being immediately taxed to pay for your first home...
A spousal RRSP, like a traditional RRSP, is a retirement savings plan that you can contribute earned and taxed income to, and invest through. One of the best features of an RRSP is that you will usually not pay tax on the income earned on the account while the money remains in it. Yo...
RRSP withdrawals are taxed like income, whereas the TFSA is entirely tax-free. So, where you can simply take out the $30k you need for that year from your TFSA, you would need to take out roughly $37k from your RRSP. Overall, we can see and learn some interesting things: The gap be...
A tax-freesavings account(TFSA) is a specialized investment account that allows individuals to save and invest money on a tax-free basis. Unlike other investment accounts, such as a regular savings account or a registered retirement savings plan (RRSP), any income earned within a TFSA...
Contributions (except contributions from an RRSP/RRIF or RESP rollover) are non-taxable but bonds, grants and investment income are considered taxable income for the beneficiary when withdrawn. RDSPs don’t affect other government tax and disability benefits for B.C. beneficiaries. Learn more about...
AIPs taken as cash are taxable income for the subscriber or joint subscriber, and are subject to an additional penalty tax of 20%. If the subscriber has unused RRSP contribution room, they may elect a tax-free transfer of up to $50,000 of AIPs to their RRSP or their spouse's RRSP. ...
When you withdraw money from accumulated income, it will be taxed at your regular income tax rate, plus an additional 20 percent. You also have the option to transfer it into your Registered Retirement Savings Plan (RRSP) or your spouse’s RRSP. How...
Anyearnings are tax-free while in the RESP, so interest gained doesn't count as income on the subscriber's taxes. The money isonly taxed when it's withdrawn— usually to pay for the beneficiary's education. Because students usually have a low income,beneficiaries can often withdraw their m...
ARegistered Retirement Savings Plan(RRSP) is the analog of the American traditional IRA. In contrast to a TFSA, contributions to a RRSP are tax-deductible and withdrawals are taxable as regular income. In addition, the RRSP contributionscan't exceed 18 percent of your previous year's earned in...
Like an RRSP, a LIRA is tax-sheltered. This means that as long as the money stays within the LIRA, you will not be taxed on any growth. Any withdrawals are taxed as income, however. In most cases, your LIRA will remain untouched until it comes time to transfer it to an LIF or a...