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I need to withdraw from my RRSP to cover an emergency. If I withdraw now and fully repay by next year, what is the tax effect?



Our response:

We are not able to provide advice. However, general information is provided below. For more information, speak to a registered financial advisor to learn more about the tax consequences of making an early RRSP withdrawal.

You can take money out of your RRSP before you retire – for example, to cover an emergency situation. But you will pay an immediate tax on the money you take out (called a withholding tax), and possibly more at tax time. You’ll also permanently lose the contribution room you originally used to make the contribution – with RRSPs, there is no option to “repay”, unless you are making the withdrawal using a program such as the Home Buyers’ Plan (to buy your first home) or Lifelong Learning Plan (to pay for your or your spouse’s education). Learn more about making RRSP withdrawals before you retire.

If you have a “locked-in RRSP”, the Financial Services Commission of Ontario (FSCO) regulates pensions including locked-in RRSP accounts. Learn how to contact FSCO and information on locked-in accounts.

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