Tax on a $40,000 RRSP Withdrawal (2026)
Withdraw $40,000 from your RRSP in 2026 and CRA withholds $12,000 immediately (30%) — or $11,600 (29%) if you're in Quebec. Your final tax bill depends on your marginal rate (other income + province).
Withheld at source (outside Quebec)
$12,000
30% of $40,000 — you receive $28,000 cash
Withheld at source (Quebec)
$11,600
29% combined fed + QC — you receive $28,400 cash
CRA Withholding Tiers (why 30%?)
| Withdrawal amount | Outside Quebec | Quebec (fed + prov) |
|---|---|---|
| Up to $5,000 | 10% | 19% (5% + 14%) |
| $5,001 – $15,000 | 20% | 24% (10% + 14%) |
| Over $15,000 | 30% | 29% (15% + 14%) |
Source: CRA S3-F10-C3 and Regulation 103. Withholding is a prepayment — your final tax is your marginal rate, reconciled on your T1.
Per-Province Final Tax (if RRSP is your only income for 2026)
Pure withdrawal scenario — e.g. retiree with no employment or CPP/OAS yet. Assumes 2026 basic personal amount (BPA) shelters the first ~$16,129 federally.
| Province | Withheld | Actual tax | Effective rate | Refund / (Owing) | Net in hand |
|---|---|---|---|---|---|
| Ontario | $12,000 | $4,661 | 12.0% | $7,339.22 | $35,339 |
| British Columbia | $12,000 | $4,797 | 12.0% | $7,203.38 | $35,203 |
| Alberta | $12,000 | $4,675 | 12.0% | $7,324.80 | $35,325 |
| Quebec | $11,600 | $5,699 | 14.0% | $5,900.52 | $34,301 |
| Manitoba | $12,000 | $5,912 | 15.0% | $6,087.52 | $34,088 |
| Saskatchewan | $12,000 | $5,357 | 13.0% | $6,643.28 | $34,643 |
| Nova Scotia | $12,000 | $6,319 | 16.0% | $5,681.39 | $33,681 |
| New Brunswick | $12,000 | $5,772 | 14.0% | $6,227.70 | $34,228 |
| Newfoundland and Labrador | $12,000 | $5,803 | 15.0% | $6,196.64 | $34,197 |
| Prince Edward Island | $12,000 | $5,913 | 15.0% | $6,087.22 | $34,087 |
| Northwest Territories | $12,000 | $4,583 | 11.0% | $7,416.96 | $35,417 |
| Yukon | $12,000 | $4,804 | 12.0% | $7,196.21 | $35,196 |
| Nunavut | $12,000 | $4,110 | 10.0% | $7,889.64 | $35,890 |
With Other Income (Ontario 2026)
What a $40,000 withdrawal actually costs when stacked on top of your existing income. Effective rate rises as your marginal rate climbs.
Other income: $0
$4,661
12.0% effective
Withheld $12,000 → refund $7,339
Other income: $30,000
$9,026
23.0% effective
Withheld $12,000 → refund $2,974
Other income: $60,000
$11,860
30.0% effective
Withheld $12,000 → refund $140
Other income: $100,000
$13,770
34.0% effective
Withheld $12,000 → owe $1,770
Run the numbers with your exact province, other income, and year: Open RRSP Withdrawal Tax Calculator →
Tax on Other RRSP Withdrawal Amounts
RRSP Withdrawal Tax by Province
Related Calculators
Frequently asked questions
How much tax do you pay on a $40,000 RRSP withdrawal?
CRA withholds $12,000 at source outside Quebec (30%), or $11,600 (29%) in Quebec. At filing you settle up at your marginal rate. With no other income in Ontario 2026, actual tax is $4,661 (12.0% effective).
How much is withheld on a $40,000 RRSP withdrawal?
CRA withholds $12,000 (30%) outside Quebec or $11,600 (29%) combined federal + provincial in Quebec. Tiers: 10%/20%/30% on ≤$5k / $5,001–$15k / $15k+ (doubled to 19%/24%/29% in Quebec).
Is a $40,000 RRSP withdrawal taxable income?
Yes — fully added to your taxable income for the year and taxed at your combined federal + provincial marginal rate. The 30% withholding is a deposit, not the final bill.
Does splitting a $40,000 withdrawal reduce tax?
Splitting $40,000 into several ≤$5,000 withdrawals drops each withholding to 10% (19% in Quebec) — but final tax at filing is identical regardless of splits. Only your cash flow before filing changes. Note: CRA can apply higher withholding if withdrawals are clearly coordinated to game the tiers.