See the real tax on an RRSP withdrawal — including the gap between withholding and what you’ll actually owe.
Your financial institution withholds tax when you withdraw — but this is just a prepayment, not your final tax bill. The withdrawal is added to your income and taxed at your marginal rate when you file.
When you withdraw from your RRSP, your financial institution withholds tax immediately — 10% on amounts up to $5,000, 20% from $5,001 to $15,000, and 30% above $15,000 (rates are lower in Quebec, plus provincial tax). But this withholding is only a prepayment. The full withdrawal is added to your taxable income for the year and taxed at your marginal rate.
This creates a common surprise: if your marginal rate is higher than the withholding rate, you’ll owe additional tax when you file. RRSP withdrawals also permanently remove that contribution room — you can’t re-contribute it later (unlike a TFSA). The exceptions are the Home Buyers’ Plan and Lifelong Learning Plan, which allow tax-free withdrawals you repay over time.
Disclaimer: This calculator provides estimates using 2025 federal and provincial marginal tax rates and standard withholding rates. It does not account for all credits, deductions, or the specific timing of your withdrawal. Quebec withholding includes a separate provincial portion. Consult a tax professional before making large RRSP withdrawals.