Your investing questions, our clear answers.

Our response:

If you are selling the stock and leaving the proceeds inside your RRSP, you do not need to pay tax.

If you plan to withdraw the proceeds, you will pay a withholding tax. Your financial institution will hold back the tax on the amount you take out and pay it directly to the government. The amount depends on how much you take out and where you live. You also have to report the amount you take out on your tax return as income. At that time, you may have to pay more tax on the money — on top of the withholding tax. It depends on your total income and tax situation.

Learn more about making RRSP withdrawals before you retire and see the withholding tax rates. Speak to a registered financial advisor to learn more about making withdrawals from an RRSP.