RRSP Withholding Tax Rates 2026 — CRA 10%, 20%, 30%

When you withdraw from a Registered Retirement Savings Plan (RRSP), the CRA requires the financial institution to withhold a portion and remit it to the government. This withholding tax is a prepayment toward the income tax you will owe on the withdrawal — it is not a separate penalty or additional tax.

Federal Withholding Tax Rates

The amount withheld depends on the withdrawal amount. Outside Quebec the CRA applies a flat federal rate only. For funds held in Quebec the federal rate is halved and Revenu Québec adds its own flat provincial withholding on top — so a Quebec resident is subject to two withholdings, not one.

The 5% / 10% / 15% column is frequently mislabelled as “Quebec’s provincial rate”. It is not — it is the reduced federal rate that applies to Quebec residents, exactly as CRA words it: “10% (5% in Quebec) on amounts up to $5,000”. The Quebec provincial withholding is a flat 14% at every tier, which is why the combined Quebec rates step 19% / 24% / 29% rather than mirroring the federal 10/20/30 ladder.

Example: If you withdraw $10,000 from a non-Quebec RRSP, the bank withholds 20% ($2,000). You receive $8,000 and the CRA receives $2,000 as a prepayment against your final tax bill.

Example (Quebec): For the same $10,000 withdrawal from a Quebec RRSP, federal withholding is the reduced 10% ($1,000) and Revenu Québec withholds a flat 14% ($1,400) — $2,400 in total, a combined 24%. You receive $7,600.

Note that the combined Quebec rate is lower than the rest of Canada at the top tier (29% vs 30%), not higher. Quebec residents are not withheld at 45%.

Withholding is not your tax bill. The withdrawal is added to your income and taxed at your own marginal rate, so the real tax on the same $10,000 depends on your province and your other income. With $80,000 of other income in 2026 it is about $2,965 in Ontario (about $965 more owed at filing on top of the $2,000 withheld) and $3,717 in Nova Scotia; with $30,000 of other income in Ontario it is about $2,055. Calculate yours with the RRSP Withdrawal Tax Calculator using your own amount, province and income.

Your financial institution reports the gross withdrawal and the tax withheld on a T4RSP slip. You will report the total withdrawal amount as income on line 12900 of your T1 return and claim the tax withheld as a credit.

The tiers are not applied withdrawal by withdrawal. CRA’s payer guide (RC4157) tells the financial institution to combine all the lump-sum payments it has paid or expects to pay you in the calendar year when choosing the rate, so breaking one year’s withdrawal into several pieces of $5,000 or less at the same institution does not keep you at the lowest rate. A withdrawal over $15,000 is withheld at the top rate on the whole amount.

Grossing Up to a Target Net Amount

To receive a specific amount in hand after withholding, divide the target by (1 − the tier’s rate): gross = net ÷ (1 − rate).

Example: To net $12,000 outside Quebec at the 20% tier, withdraw $12,000 ÷ 0.80 = $15,000. The bank withholds $3,000, leaving $12,000.

Example (Quebec): To net $8,000 at the combined 24% tier, withdraw $8,000 ÷ 0.76 ≈ $10,526. About $2,526 is withheld, leaving roughly $8,000.

Check that the gross amount still falls inside the tier you assumed; if it crosses a threshold, recompute with the next tier’s rate.

How Withholding Relates to Your Actual Tax Bill

The withholding tax is an estimate, not the final amount. When you file your annual return:

• If your marginal rate is higher than the withholding rate, you will owe additional tax on the withdrawal.
• If your marginal rate is lower (e.g., you withdrew in a low-income year), you may receive a refund of some of the withholding.
• Withholding is calculated at source in isolation, without considering your other income, deductions, or credits. Your actual tax depends on your total income for the year.

Key point: Withdrawing a large lump sum in a high-income year can push you into a higher bracket, triggering additional tax beyond the 30% already withheld. Plan withdrawals for years when your income is lower.

Exceptions: HBP and LLP Withdrawals

Withdrawals under the Home Buyers’ Plan (HBP) and the Lifelong Learning Plan (LLP) are not taxed at the time of withdrawal — and no withholding tax applies — provided you repay the full amount under the plan’s repayment schedule.

• HBP: Withdraw up to $60,000 tax-free for a first home. Repay over 15 years. Repayment normally starts the second year after the first withdrawal; for a first withdrawal made from 2022 through 2028 it starts in the fifth year.
• LLP: Withdraw up to $10,000 per year (maximum $20,000 total) for full-time training or education. Repay over 10 years.

If you fail to make a scheduled repayment, the missed amount is added to your income for that year and taxed at your marginal rate.

RRIF Minimum Withdrawals — Different Rules

An RRSP must mature by December 31 of the year you turn 71: you withdraw the funds (fully taxable), transfer them to a Registered Retirement Income Fund (RRIF), or use them to buy an annuity. RRIF withdrawals follow different withholding rules:

• Minimum withdrawal amount: No withholding tax applies to the mandatory minimum. The CRA treats the minimum as a planned distribution, not a discretionary withdrawal.
• Above-minimum withdrawals: Any amount withdrawn above the minimum is subject to the same withholding rates as RRSP withdrawals (10%/20%/30% tiers).

Strategy: If you need extra income from your RRIF, withdrawing the minimum first (no withholding) before making additional withdrawals can reduce total tax withheld.

Special Cases

Non-Resident Withholding

If you are a non-resident of Canada and withdraw from a Canadian RRSP, the withholding rate is a flat 25% on the gross withdrawal. This rate may be reduced under a tax treaty — for example, the Canada–US treaty reduces it to 15% for certain periodic payments. The financial institution does not apply the resident tiered rates.

Lump-Sum Deregistration

If you deregister an RRSP entirely (closing the plan without transferring to a RRIF or annuity), the full value is treated as income in the year of deregistration. The standard tiered withholding rates apply at the time of the lump-sum payment, so a plan worth more than $15,000 is withheld at the 30% rate on the full amount. Your final tax bill may be significantly higher if the lump sum pushes you into a top marginal bracket.

Death of the Annuitant

When the RRSP annuitant dies, the fair market value of the plan is included in their income on the final return unless the plan passes to a surviving spouse or qualifying dependent. No income tax is withheld from a refund of premiums paid to the deceased annuitant’s spouse or common-law partner.

Plan Your Withdrawal — Use the Calculator

Before making a withdrawal, use our RRSP Withdrawal Tax Calculator to see exactly how much tax will be withheld and estimate any additional tax you may owe at filing. Enter your province, withdrawal amount, and expected annual income to get a complete picture.

Calculate your RRSP withdrawal tax now →