When you withdraw from your RRSP, your bank is required to deduct RRSP withholding tax before the money ever reaches your account. Here’s exactly how much they’ll take — by withdrawal size, province, and residency status — plus a free calculator to estimate your deduction before you make the call.
When you withdraw money from your RRSP before converting it to a RRIF or annuity, your financial institution is legally required by the CRA to deduct a portion of the withdrawal immediately. This deduction is called withholding tax — it works like income tax deducted at source from a paycheque.
The withheld amount is sent directly to the CRA on your behalf. It is an advance payment toward your eventual income tax bill for the year — not a separate or additional tax on top of what you already owe.
Key point: Withholding tax is not your final tax bill. You reconcile it on your T1 return at year-end. If too much was withheld, you receive a refund. If too little, you owe the difference.
2026 RRSP Withholding Tax Rates by Withdrawal Amount
The CRA sets RRSP withholding tax rates based on the size of each individual withdrawal. These rates apply to Canadian residents in all provinces except Québec.
Canadian Residents — Excluding Québec2026 — confirmed
Withdrawal Amount
Withholding Rate
Example: $10,000 withdrawal
$5,000 or less Low
10%
Withheld: $500 · You receive: $4,500
$5,001 – $15,000 Mid
20%
Withheld: $2,000 · You receive: $8,000
Over $15,000 High
30%
Withheld: $3,000 · You receive: $7,000
Important: These rates apply per transaction, not per year. Two separate $5,000 withdrawals each attract 10%. But a single $10,001 withdrawal triggers 20% on the entire amount.
Québec Residents: Different Rates Apply
Québec residents pay both federal and provincial withholding tax on RRSP withdrawals. The combined rates are slightly lower than you might expect — because Québec collects its provincial tax separately through Revenu Québec, the federal portion is reduced.
Withdrawal Amount
Federal Rate
Provincial (Québec)
Combined
$5,000 or less
5%
14%
19%
$5,001 – $15,000
10%
14%
24%
Over $15,000
15%
14%
29%
The federal portion is reported on your T4RSP slip; the provincial portion on your RL-2 slip. Both are credited against your respective tax returns at filing.
Non-Resident Withholding Rates
If you are a non-resident of Canada and withdraw from an RRSP, the standard withholding rate is 25% on the gross withdrawal, regardless of size. Canada’s tax treaties with many countries reduce this rate.
Non-Resident Treaty Rates (Select Countries)Per Article XVIII
Country
Treaty Rate
Notes
United States
15%
Periodic payments; lump sums may attract 25%
United Kingdom
25%
Standard rate applies
Australia
25%
Standard rate applies
No tax treaty
25%
Default CRA rate
NR4 slip: Non-residents receive an NR4 slip (not a T4RSP) showing the gross amount withdrawn and withholding tax deducted. Consult a cross-border tax advisor to determine whether you can reclaim any portion in your country of residence.
RRSP Withholding Tax Calculator
Enter your withdrawal amount and province to see exactly how much your bank will withhold, and how much you’ll actually receive.
Estimate Your Withholding Tax
Based on 2026 CRA rates. This is an estimate — your final tax may differ.
$
Enter the amount in Canadian dollars
Your Estimate
You Withdraw
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Tax Withheld
—
You Receive
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Real-World Examples
Here’s how withholding tax plays out across three common scenarios for an Ontario resident in 2026.
Scenario A — Small Withdrawal
Sarah withdraws $4,000 for an emergency expense.
At Withdrawal
Withdrawal$4,000
Rate (≤$5,000)10%
Tax withheld−$400
Deposited to account$3,600
At Tax Filing
Actual tax owed (est. 26%)$1,040
Already withheld$400
Owes at filing$640
Scenario B — Mid-Tier in a Low-Income Year
James withdraws $10,000 during parental leave — a lower-income year.
At Withdrawal
Withdrawal$10,000
Rate ($5,001–$15,000)20%
Tax withheld−$2,000
Deposited to account$8,000
At Tax Filing
Actual tax owed (est. 15%)$1,500
Already withheld$2,000
Refund at filing+$500
Scenario C — Large Lump Sum
Linda withdraws $40,000 all at once for a major purchase.
At Withdrawal
Withdrawal$40,000
Rate (over $15,000)30%
Tax withheld−$12,000
Deposited to account$28,000
At Tax Filing
Actual tax owed (est. 43%)$17,200
Already withheld$12,000
Owes at filing$5,200
Withholding Tax vs. Your Actual Tax Bill
This is the most commonly misunderstood aspect of RRSP withdrawals. The withholding rate and your actual tax rate are two different things.
The RRSP withholding tax rate is fixed at the moment of withdrawal, determined only by the size of that transaction. Your actual tax, by contrast, is determined at year-end based on your total income from all sources — employment, investments, RRSP withdrawals, CPP, OAS, and more.
If your marginal rate is lower than the withholding rate, you get a refund when you file. If it’s higher — very common with large lump-sum withdrawals — you will owe additional tax at filing.
Strategic tip: Timing your RRSP withdrawal in a lower-income year — a sabbatical, mat/pat leave, or the gap between retirement and CPP starting — can significantly reduce your actual tax rate, even though the withholding rate stays the same.
The CRA publishes the official RRSP withholding tax rates in its Tax Rates on RRSP Withdrawals guide, which is updated whenever rates change.
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For Canadian residents outside Québec: 10% on withdrawals up to $5,000, 20% on $5,001–$15,000, and 30% on amounts over $15,000. Québec residents pay a combined 19–29%. Non-residents face a flat 25%, reduced to 15% for US residents under the Canada-US tax treaty.
The rate tiers are set by the Income Tax Act and have been stable for many years. The dollar thresholds ($5,000 and $15,000) are not indexed to inflation — they have remained unchanged since the 1990s. Always confirm with the CRA or your financial institution for the most current information.
No — withholding tax is an advance collection of income tax, not a separate tax. RRSP withdrawals are added to your taxable income for the year. The amount withheld is credited against your total tax owing when you file your T1. Depending on your overall income and deductions, you may receive a partial refund or owe more.
Generally no — financial institutions are legally required to apply CRA withholding rates based on the withdrawal amount. You cannot instruct your bank to withhold less. However, you can reduce the effective rate by splitting a larger withdrawal into multiple smaller ones, each under $5,000 to qualify for the 10% tier.
Your financial institution issues a T4RSP slip after the calendar year, showing the total amount you withdrew and the total withholding tax deducted. You enter both on your T1 return — the withdrawal amount as income, and the withheld amount as a tax credit applied against what you owe.
The withholding rates are the same regardless of age. However, most Canadians convert their RRSP to a RRIF by age 71. RRIF minimum withdrawals are not subject to withholding tax — only amounts above the minimum are withheld. This distinction matters significantly for retirement income planning.
Key Takeaways
RRSP withholding tax is deducted at source by your bank — 10%, 20%, or 30% depending on withdrawal size
Québec residents pay a combined federal + provincial rate of 19–29%
Non-residents are generally withheld at 25%, reduced to 15% for US residents under treaty
Withholding is an advance payment — your actual tax is settled at year-end on your T1 return
Timing withdrawals in lower-income years can reduce your real tax rate, even if withholding stays fixed
Use our free Coast FIRE Calculator to find out how much you need invested today — so your savings can grow to fund retirement without another dollar contributed.
Disclaimer: The information on this page is for general educational purposes only and does not constitute tax, legal, or financial advice. RRSP withholding tax rates are set by the Canada Revenue Agency. Your actual tax liability depends on your total income, province of residence, applicable deductions, and other factors. Always consult a qualified tax professional before making RRSP withdrawal decisions.
