Tax breakdown
| Without Withdrawal | With Withdrawal | Difference | |
|---|---|---|---|
| Taxable income | - | - | - |
| Federal tax | - | - | - |
| Provincial tax | - | - | - |
| Total tax | - | - | - |
Enter your other income, province, and RRSP withdrawal amount to see the actual tax on your withdrawal, not just the withholding estimate. The calculator shows the difference between what your bank withholds and what you actually owe at tax time.
For projecting long-term RRSP growth and contributions, see the RRSP calculator. To check your contribution room, use the RRSP contribution room calculator.
RRSP withholding tax rates (2026)
When you withdraw from your RRSP, your financial institution deducts withholding tax before sending you the money. These rates are set by the CRA and are not the actual tax you owe — they are an approximation.
All provinces except Quebec
| Withdrawal Amount | Withholding Rate |
|---|---|
| Up to $5,000 | 10% |
| $5,001 to $15,000 | 20% |
| Over $15,000 | 30% |
Quebec
Quebec has a split withholding — federal and provincial are deducted separately.
| Withdrawal Amount | Federal Withholding | Quebec Provincial |
|---|---|---|
| Up to $5,000 | 5% | 14% |
| $5,001 to $15,000 | 10% | 25% |
| Over $15,000 | 15% | 25% |
Important: The withholding rate applies to the entire withdrawal, not just the portion above each threshold.
Why withholding tax is rarely the right amount
Withholding tax is a flat estimate. Your actual tax bill is calculated using progressive marginal brackets on your total income for the year — including the RRSP withdrawal.
Example — $20,000 RRSP withdrawal in Ontario with $60,000 salary:
| Withholding Estimate | Actual Tax | |
|---|---|---|
| Bank withholds at 30% | $6,000 | — |
| Federal tax on extra $20,000 | — | $4,100 |
| Ontario tax on extra $20,000 | — | $1,830 |
| Total actual tax | $6,000 | $5,930 |
| Owed / (refund) at filing | — | (refund $70) |
In this case, the withholding was close. But if you withdrew $20,000 with only $20,000 of other income, the actual tax would be far lower than the 30% withholding — leading to a larger refund.
When to withdraw from your RRSP
Best scenarios for early withdrawal
- Gap years with no employment income — Your marginal rate drops to the lowest bracket (15% federal + lowest provincial), so you keep 75-85% of the withdrawal
- Early retirement before age 65 — Before CPP, OAS, and pension income start, your taxable income is low. This is the ideal time to draw down RRSP balances gradually
- Income below $55,000 — You stay in the 15% federal bracket. Provincial rates are also lowest at this level
Worst scenarios for withdrawal
- While earning a high salary — The withdrawal is taxed at your highest marginal rate (40-54%), and you permanently lose the contribution room
- Large lump sums — Pushes you into higher brackets. $100,000 at once is taxed far more heavily than $20,000/year for 5 years
- Above $90,997 (in 2026) — OAS clawback begins, effectively adding 15% to your marginal rate on income above this threshold
RRSP withdrawal tax by income level
Here is the approximate tax on a $10,000 RRSP withdrawal at various income levels in Ontario:
| Other Income | Marginal Rate | Tax on $10K Withdrawal | Net You Keep | Withholding (20%) | Owed at Filing |
|---|---|---|---|---|---|
| $0 | 20.1% | $730 | $9,270 | $2,000 | (refund $1,270) |
| $30,000 | 24.2% | $2,010 | $7,990 | $2,000 | $10 |
| $50,000 | 29.6% | $2,960 | $7,040 | $2,000 | $960 |
| $75,000 | 31.5% | $3,150 | $6,850 | $2,000 | $1,150 |
| $100,000 | 33.9% | $3,390 | $6,610 | $2,000 | $1,390 |
| $150,000 | 43.4% | $4,340 | $5,660 | $2,000 | $2,340 |
Note: At $0 other income, the basic personal amount credit reduces tax significantly.
Tax-free RRSP withdrawal options
Home Buyers’ Plan (HBP)
First-time home buyers can withdraw up to $60,000 tax-free from their RRSP for a qualifying home purchase. The amount must be repaid over 15 years starting 2 years after the withdrawal. See the Home Buyers’ Plan guide and HBP calculator for details.
Lifelong Learning Plan (LLP)
You can withdraw up to $10,000 per year (maximum $20,000 total) tax-free to fund full-time education for yourself or your spouse. Repayment is over 10 years starting 5 years after the first withdrawal.
Impact on government benefits
RRSP withdrawals increase your net income, which can trigger clawbacks on income-tested benefits:
| Benefit | Income Threshold for Clawback | Clawback Rate |
|---|---|---|
| OAS pension | $90,997 (2026) | 15% |
| GIS supplement | $21,624 (single) | 50-75% |
| Canada Child Benefit | Varies by # of children | 3.2-23% phaseout |
| GST/HST credit | $45,000-$55,000 (approx.) | 5% phaseout |
| Provincial benefits | Varies | Varies |
For retirees receiving OAS: A $10,000 RRSP withdrawal that pushes your income above $90,997 will reduce your OAS by $1,500 (15% of the excess). This effectively raises the marginal rate on that withdrawal by 15 percentage points.
RRSP vs TFSA withdrawal comparison
| RRSP Withdrawal | TFSA Withdrawal | |
|---|---|---|
| Taxed as income? | Yes, fully | No |
| Withholding tax? | Yes (10-30%) | No |
| Affects benefits? | Yes (OAS, GIS, CCB) | No |
| Contribution room restored? | No, permanently lost | Yes, restored following year |
| Best for | Retirement income when marginal rate is lower | Emergency funds and tax-free income |
This is why many financial planners recommend a mix of RRSP and TFSA savings. TFSA withdrawals give you income that doesn’t affect your tax bracket or government benefits.
Related calculators
- RRSP Calculator — Project your RRSP growth and tax savings over time
- RRSP Contribution Room Calculator — Check your available contribution room
- Income Tax Calculator — Full income tax breakdown with all deductions
- Salary After Tax Calculator — See take-home pay by province
- Marginal Tax Rate Calculator — Find your exact marginal rate
- Retirement Calculator — Plan your retirement income needs
- TFSA Calculator — Compare tax-free growth in a TFSA