We solve serious CRA tax problems

Home Accessibility Tax Credit

RRIF Withdrawals

Changes in the rules for RRIFs have reduced the amount that is required to be withdrawn from a RRIF for individuals over age 70. These changes are effective at the start of the 2015 tax year. For persons under the age of 71 the formula of 1/(90-age) remains unchanged. The age used would be the spouse’s age.

There are also rules, including those that are age related, that are used to determine the minimum amount that has to be withdrawn from a defined contribution pension plan or a Pooled Registered Pension Plan.

If RRIF withdrawals are more than the new minimum amounts, at any time in 2015, the amount representing the excess of the old minimum amount less the new minimum amount can be re-contributed before March 1, 2017. Where such amounts are re-contributed, they can be deducted from income in 2016.

  • For those under the age 71 the formula of 1/(90-age) remains unchanged
  • This would be the spouse’s age when using that option
  • These factors are also used to determine the minimum amount to be withdrawn from a defined contribution pension plan and Pooled Registered Pension Plan

If RRIF withdrawals are more than the new minimum amounts at anytime in 2015, the excess of the old minimum amount less the new minimum amount can be re-contributed before March 1, 2017 and deducted from income in 2016.

FAQ’s on Getting a CPA in Hamilton, ON

What is RRIF and what is its purpose?

RRIF stands for Registered Retirement Income Fund, a retirement vehicle in Canada comparable with an annuity. It provides retirees with a continuous source of income from their savings vehicles. A life income fund (LIF) is an RRIF type offered in the country that’s developed to hold locked-in pension funds.

What is the current minimum for an RRIF withdrawal?

Based on the 2021 RRIF minimum withdrawal rate table, the minimum percentage that Canadian seniors must withdraw from their RRIFs yearly is between 2.86% for those aged 55 and 20% for ages 95 and above. Seniors must make withdrawals from their RRIFs before they turn 72.

How often can I make an RRIF withdrawal?

You can make lump sum withdrawals, or you can do them monthly, quarterly, or semi-annually as long as the total amount equals or goes over the minimum amount. However, if you withdraw more than the minimum, you’d have to pay withholding taxes on the excess.

About the Author

pro-tip

Pro Tip

ACCESSING THE SMALL BUSINESS DEDUCTION IN YOUR BUSINESS

The Small Business Deduction gives businesses a tax deduction on the first $500,000 of income. This saves an eligible corporation around up to $50,000 in income taxes. There are a number of conditions that have to be met to be eligible for this deduction.

Faris CPA was awesome! I cannot express how grateful I was during my tax audit.

Super kind and approachable- they took the time to explain the entire process. They answered all my questions/concerns and made sure I understood everything.

They made sure nothing was overlooked and would keep in touch with me should they need any docs as well as asked me questions to ensure accuracy.

I really appreciated their dedication and expertise! For anything tax-related, I truly recommend Faris CPA.
Response from the owner:Thank you Donald for your five stars review. We will remain at your disposal if you need our services in the future.
Great experience dealing with Sam Faris and his team. They were transparent, patient with their explanations and they meet all promises. Highly reliable and trustworthy firm. They promise and they meet all their promises. If you are looking for the best tax consultant firm, I highly recommend Faris CPA.
Response from the owner:Many thanks and much appreciated for the kind and positive review.
Sam Faris is a consummate professional whose expertise, clarity, and warmth make him worth every penny. If you need clear answers and effective solutions for complex situations, he’s your go-to.

I only write reviews when they’re truly deserved, and after meeting with Sam, I’m compelled to share my experience. I’m meticulous about researching professionals before reaching out, and Sam exceeded my expectation.

From the moment I arrived for a consultation on a nuanced issue, Sam greeted me with a warm yet focused demeanor that instantly put me at ease. He was fully present, diving into my situation with laser-like attention.  As I explained my case, he listened intently, then walked me through each aspect with clear, concise expertise, pausing to ensure I had no questions before moving forward. His ability to break down complexity into actionable insights was remarkable.

What stood out most was his honesty and confidence. He calmly assured me that my situation, while intricate, was well within his expertise—backed by his extensive track record of handling far more complex cases. His steady presence and thorough understanding left me feeling reassured.

Sam's stellar reputation, reflected in his consistent high reviews, is no fluke. He’s the real deal: an upstanding professional whose integrity and skill are rare in today’s world. If you’re facing a challenging situation and need straightforward answers, reassurance, and results, contact Faris.
Response from the owner:It has been pleasure working with you and feel free to contact us in the future for any further help needed.
Thank you for all your help. Reliable and highly professional firm.
Response from the owner:Thank you for the positive review.