My_question_is: Canadian-specific
Subject: RRSP Withdrawal
Expert: taxman at centa.com
Date: Monday October 31, 2005
Time: 04:29 PM -0800
QUESTION:
I moved my family from Ontario to BC this year - new job. The costs of the
move are deductable as against income earned at the new location.
The expenses are very high (Real Estate commisions, movers etc) and it would
appear that I should recover most of the income tax deducted at source for
2005.
Question: Would this be an opportune time to withdraw funds from my RRSP (in
2005). I will not retire for another 3 or 4 years.
Many thanks
(enjoy your show on Sunday AM)
-----------------------------------
david ingram replies:
If the move has coat enough to get your taxable income down to zero, then it
is a good time to take out some RRSP money if the taxable income will be
under $35,000 and be taxed at the lowest rate. However, you are still
paying tax money that is not necessary if you do not need the money.
But, if you can use $20,000 to pay down the mortgage or even maybe take the
money out and use it to buy some spousal RRSP in your spouse's name
(assuming you have unused RRSP room) you may have a winner.
I would do this when I have "room" for more RRSP which could be purchased as
a spousal but no money to buy it. If you take it out and buy more in your
wife's name, it is revenue neutral now and can put more money into your
spouse's name at a lower tax rate in the future.
This is the kind of thing which needs the kind of "what if" calculations
that Fred Snyder will do for you as part of his written financial plan. You
should likely come out for one of the seminars and then get a written plan
showing you what happens if you do that now.
seminar directions will follow the 600 AM plug.
Answers to this and other similar questions can be obtained free on Air
every Sunday morning.
Every Sunday at 9:00 AM on 600AM in Vancouver, I, david ingram am a regular
guest on Fred Snyder of Dundee Wealth Managers' LIVE talk show called "ITS
YOUR MONEY"
Those outside of the Lower Mainland will be able to listen on the internet
at
www.600AM.com <http://www.600am.com/>
Call (604) 280-0600 to have your question answered. BC listeners can also
call 1-866-778-0600.
Callers to the show and questioners on this board can also attend the
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Interest deductible.
And for those in the Vancouver area, Fred is running an infomercial for 1/2
hour every night in October on Channel 10 television at "groooaaannnn" 1 AM
in the morning. It has a couple of useful concepts in it that can be
recorded to really get the idea.
Every Thursday Evening, Fred Snyder of Dundee Wealth Management conducts one
of 17 different financial seminars in the boardroom of his office
Time: 7:00 to 9:30 PM
Date: Every Thursday evening
Place 1764 West Seventh
Vancouver (corner of Burrard)
Phone (604) 731-8900 to register
No cost - no obligation
Topics always cover mortgage interest as a deduction
other topics - getting the mortgage, estate planning, critical care
insurance, income taxation, differences between stocks and bonds, and
usually the most innovative HELOC mortgage offered in Canada from Manulife
Bank
If you are starting in downtown Vancouver and do not want to go home first,
one of the excellent THAI HOUSE restaurants is in the same building and
makes a nice start to the evening.
I, david ingram, manage to make three out of 4 of them to cover mortgage
interest as a deduction and give the class an adding test.
David Ingram's US/Canada Services
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