Behind the Headlines

Article Excerpt

You can now take out $2,000 a year from a RRIF without paying federal income taxes if you’re over 65, up from $1,000 previously. This will let you save around $305 a year in tax, up from $153. To take full advantage of the credit, you can transfer approximately $9,100 to a RRIF at age 65 (which assumes a growth rate of 5% a year), and then take $2,000 out per year from ages 65 through 69. This lets you take $10,000 out of your RRSP free of federal tax free over five years before you are required to convert your RRSP to a RRIF at 69. However, before converting part of your RRSP to a RRIF, you’ll want to consider your personal circumstances. If you need the funds from your RRSP for ongoing expenses, then you should take advantage of the $2,000 annual pension tax credit. By taking the $10,000 out a few years earlier, you’ll save tax. But…

You are trying to access subscriber-only content.

To read this article, you may subscribe or sign in.
If you are already a subscriber, log in here.

If you wish to become a subscriber, click here. Or you may enjoy access to all our publications when you become a Member of Pat McKeough's Inner Circle Pro.