Choosing between a Registered Retirement Fund and Tax-free Savings Account can be a challenge for many Canadians. To help simplify this decision, here’s an easy to read infographic.
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Notes: Funds can be withdrawn tax-free from RRSPs in low-income years if your income and total RRSP withdrawals do not exceed the federal and provincial basic personal amount. For example, in 2016 this is: Federal – $11,327 and Ontario – $11,474.
The banks will have a withholding tax when you withdrawal from your RRSP, but this will be refunded when you file your taxes.
Limits: All contributions to TFSA and RRSPs are also subject to your personal limits.
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