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Is it possible to withdraw funds from a RRIF and replace the funds a month later, without any tax payment being required?



Our response:

Thank you for your question, Marg.

All withdrawals from a Registered Retirement Income Fund (RRIF) are fully taxable. Also, once the RRIF is set up, you can’t make any more contributions to the plan. Therefore, you would not be able to replace the withdrawal in the same plan a month later.

The federal government sets the minimum amount you must take out of your RRIF every year, based on a percentage of the value of your RRIF. There is no maximum withdrawal limit. However, if you take out more than the minimum amount, you’ll also pay withholding tax on the excess amount. Your financial institution will hold back an amount, based on withholding tax rates, and pay it directly to the government on your behalf. Here is more information about how RRIFs work.

Speak to a financial advisor or tax professional if you need advice or assistance with understanding the tax consequences of RRIF withdrawals, and your options when making withdrawals from this type of account.

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