Discover everything you need to know about RRSP (Registered Retirement Savings Plan) accounts with Moomoo Canada.
3. How to open a RRSP account?
Clients with a Registered Retirement Savings Plan (RRSP) through Canada Revenue Agency (CRA) are allowed to invest on a tax-deferred basis, providing several advantages such as:
Contributions made to the RRSP are tax deductible (up to a limit).
Any income or capital gain received inside the RRSP would not be taxed until the money is withdrawn.
*Please note that Moomoo Canada clients can only open one regular RRSP account.
Notices:
Locked-in plans or Registered Retirement Income Funds (RRIF) are not offered. Withdrawals under the Home Buyer's Plan and the Lifelong Learning Plan, or investments in a home mortgage are also not accommodated.
Asset swaps or transfers in kind (cash or securities) from a cash or margin account or elsewhere to a RRSP or TFSA account are not supported.
RRSP/TFSA outbound or inbound transfers (to or from another financial institution) via Free of Payment (FOP) or Direct Registration System (DRS) are not supported.
Only supports RRSP/TFSA outbound transfers (to another financial institution) through the fully-electronic/ATON™ (Account Transfer Online Notification) transfer system.
Manual or "non-ATON" RRSP/TFSA inbound transfers (from another financial institution) are supported.
A Regular RRSP account can be opened by contributing cash or transferring qualified investments ("in kind") from another registered plan account.
*Please note that Moomoo Canada only supports cash contributions and inbound ATON transfers of existing RSP accounts to start.
You can submit an application in the app or on the website. Click here to check the detailed account opening instructions.
No account maintenance fees are charged. However, there is a fee of 50 CAD for each withdrawal from an RRSP account.
RRSP (Registered Retirement Savings Plan) mature by the end of the year in which the annuitant turns 71 years old. By the last day of that year, clients must withdraw their funds, transfer them to a Retirement Income Fund (RIF), or use them to purchase an annuity.
The contribution limit for a tax year is usually shown on the taxpayer's CRA notice of assessment, which includes any unused contribution room from previous years.
Contributions to an RRSP account can be made at any time during the calendar year or within 60 days after the end of the calendar year.
Contributions exceeding the limit are considered excess contributions. The lifetime allowance for over-contributions is 2,000 CAD, and any additional over-contributions are subject to a monthly penalty tax of 1%.
If you withdraw funds from your Registered Retirement Savings Plan (RRSP), a withholding tax will be automatically deducted at the time of the withdrawal. The rate of withholding tax is determined by both the amount withdrawn and the region of residency. Click here to check the detailed withholding tax rate.
RRSP accounts are also counted as a separate account for CIPF (Canadian Investor Protection Fund) coverage, and so are eligible for an additional 1M CAD coverage under CIPF.
Residents of Quebec cannot designate beneficiaries on their RRSP account, as this can only be done through a last will and testament.
In other provinces, beneficiaries can be individuals or entities. If an entity such as a charity or estate is chosen, only one beneficiary is allowed. If the applicant wants multiple beneficiaries, only individuals are permitted.