Does anyone know if there's a penalty for liquidating one's RRSP account? I'm not a resident of Canada anymore, and the account has not been active for years. It's just a pile of cash sitting there. I'm thinking of closing it to help pay for school.
Nope - no penalty... you just have to pay the tax on it. I pulled my RRSP money a few years ago and didn't have to pay anything.
Posted by: Al at July 29, 2004 02:32 PMNope - no penalty... you just have to pay the tax on it. I pulled my RRSP money a few years ago and didn't have to pay anything.
Posted by: Al at July 29, 2004 02:32 PMThere's a program where you can withdraw RRSP money for educational purposes called Lifelong Learning Plan (LLP). You don't have to pay any tax, but you have to 'pay back' your RRSP within 10 years of completing the program (otherwise you must pay 1/10th of the tax each year for 10 years.) The only catch is that the school has to consider you to be full-time.
If you're interested check www.ccra.gc.ca
Posted by: Tree at August 4, 2004 01:04 PM