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Email this9:55 am
August 7, 2022
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You can now do your own financial planning quite cheaply using the Adviice web site. I'm not affiliated with them and I use their product.
10:00 am
February 2, 2014
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Upon death, the fair market value (FMV) of your RRSP is included in your final tax return, known as the “terminal return.” This amount is taxed as income, potentially resulting in a significant tax liability.
TFSAs are not taxed at death, so maximizing your tfsa through increased RRIF withdrawals makes sense as far as your heirs are concerned.
10:10 am
December 18, 2024
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RetirEd said
It's a no-brainer to pull out RRSP funds if there's no tax implication (due to low net income) room to put them into a TFSA.Organic and natural foods are a trendy scam. There is NO evidence of any health benefits. They just make some people feel better.
I am no tax guru, but would say that any one with a RRIF or RRSP withdrawal would have to pay taxes as a result of the withdrawal. And preferably the withdrawal is controlled to be taxed in the lowest tax bracket.
Not sure what a tax implication is?
10:13 am
December 18, 2024
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step300 said
You can now do your own financial planning quite cheaply using the Adviice web site. I'm not affiliated with them and I use their product.
step300 said
You can now do your own financial planning quite cheaply using the Adviice web site. I'm not affiliated with them and I use their product.
Good to know.
My strategies are from my common sense, my errors, taking good ideas from this web site, and from my ex advisor. The only other person involved is my spouse.
10:22 am
March 30, 2017
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RetirEd said
Organic and natural foods are a trendy scam. There is NO evidence of any health benefits. They just make some people feel better.
Don't we all do things that make us feel better ? That by itself is already a benefit.
10:31 am
December 18, 2024
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Q said
Upon death, the fair market value (FMV) of your RRSP is included in your final tax return, known as the “terminal return.” This amount is taxed as income, potentially resulting in a significant tax liability.
TFSAs are not taxed at death, so maximizing your tfsa through increased RRIF withdrawals makes sense as far as your heirs are concerned.
FMV would not apply to GICS….Current Value at time of death would.
Estate tax rate is based on the type of CRA trust. There is a 3 year trust and is taxed at lower rates. While the other trust account has all earned income taxed at the highest rate. Of course there is a big hit of taxes for the tax year of death for the deceased last tax return. Then the estate trust account is still taxable and can be at the normal rates. Earnings in non registered and TFSA after death remain taxable to the estate.
Based on the “principle” of not paying a huge end of life tax assessment, maximizing your TFSA through increased RRIF withdrawals makes sense as far as your heirs are concerned AND for the SUCCESSOR!!
And to be very honest, who cares about the beneficiaries.
But if you plan well enough ahead of time you can avoid higher taxes for successor and the estate.
10:48 am
April 14, 2021
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RetirEd said
Organic and natural foods are a trendy scam. There is NO evidence of any health benefits. They just make some people feel better.
And give people a reason to falsely brag about their personal 'healthier' lifestyle, just like vegetarianism.
"I am superior/smarter than you, because I have a more gooder diet."
12:10 pm
September 11, 2013
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Unless you grow it yourself organic food is a displayable luxury for the urbanites who have the extra money. The yields are such that the world's huge urban population could not be fed via organic farming methods, not even close.
Whenever they ask those 100+ years long-livers what the secret to their long life is I'm not sure I've ever heard one attribute it to organic food diet.
12:36 pm
September 29, 2017
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Place an organic carrot next to a non-organic one, then taste them. Then tell me there is no difference. Then consider why, and how this applies to other organics vs non.
3:51 pm
October 27, 2013
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It does not matter. As Bill just said, it is impossible to grow enough food to feed the world using only organic methods. The discussion is a derailment of this thread. Take it to a thread of its own.
5:14 pm
December 7, 2011
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GIC-Fanatic said
I am no tax guru, but would say that any one with a RRIF or RRSP withdrawal would have to pay taxes as a result of the withdrawal. And preferably the withdrawal is controlled to be taxed in the lowest tax bracket.
Not sure what a tax implication is?
No tax implication for anyone with low income below $16,000.
5:18 pm
January 25, 2024
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GIC-Fanatic said
FMV would not apply to GICS….Current Value at time of death would.
GIC, TFSA are real - live money already taxed and should not be part of estate or whatnot.
If you have joint GIC this is YOUR money, nothing to report to CRA.
RRSP/RRIF are Register funds and sooner you take it out less will stay there for government to grab and waste on military, exotic trips, etc.
I do not understand all those advises getting money from RRIF and maximizing TFSA??? TFSA limit is so puny anybody can always maximize it. Assuming you invested in RRSP smartly and have 1mill or about. Yearly RRIF withdrawal is about 40K (for starters) and 7K to put into TFSA is negligible.
Now 40K from RRIF, OAS, CPP, interest from GIC - live money, some corporate pension can easily get get you to 80-90K income so you HAVE to pay tax unless you want to not to invest in GIC and keep money in a shoebox under the bed. Even then income will be easy in >60K range.
5:38 pm
October 27, 2013
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Few Canadians 65 and over have RRSPs worth anything close to what you suggest. in https://blueprintfinancial.ca/average-rrsp-balance-by-age-are-you-saving-enough/ the average value of an RRSP (in 2022) at age 65 is $224k and the median is $100k.
A 5% minimum annual withdrawal rate is thus $11.2k and $5k before tax which does not provide much to fund a TFSA. On another point, that tax is not free money to the government. It is simply repayment of the tax loan provided to the RRSP account holder at the time the contribution and deduction was taken. The same is true for DB pensions of course.
Granted those who are members of this forum will most likely have far more robust RRSPs but not everyone as we already know. A lot of folks are bumping around in the lowest 15% tax bracket. There are indeed 'low tax' opportunities to pull enough from a RRIF to fund a TFSA contribution if there are future tax advantages to do so. It takes a special set of circumstances to make it worthwhile to pay RRIF tax early for a TFSA contribution, rather than defer it as long as possible.
11:03 am
December 18, 2024
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CAD said
GIC-Fanatic said
FMV would not apply to GICS….Current Value at time of death would.GIC, TFSA are real - live money already taxed and should not be part of estate or whatnot.
If you have joint GIC this is YOUR money, nothing to report to CRA.RRSP/RRIF are Register funds and sooner you take it out less will stay there for government to grab and waste on military, exotic trips, etc.
I do not understand all those advises getting money from RRIF and maximizing TFSA??? TFSA limit is so puny anybody can always maximize it. Assuming you invested in RRSP smartly and have 1mill or about. Yearly RRIF withdrawal is about 40K (for starters) and 7K to put into TFSA is negligible.
Now 40K from RRIF, OAS, CPP, interest from GIC - live money, some corporate pension can easily get get you to 80-90K income so you HAVE to pay tax unless you want to not to invest in GIC and keep money in a shoebox under the bed. Even then income will be easy in >60K range.
I have 2 objectives.
1. Move as much RRIF to TFSA and pay no more in taxes than if I took mandatory amounts only, until funds are exhausted. Then when needed, withdraw from TFSA at RRIF %’s or more.
2. If I or spouse dies we won’t have hefty taxes to pay as the one person left won’t have all the “married” exemptions or income splitting, as the one left, in our case, will have double the amount of RRIF payments.
Please write your comments in the forum.