RRIFs

This particular income fund offers you a way to receive regular income from your matured registered retirement savings plan while allowing you to defer income tax on the undrawn portion. (Remember, at age 71, all RRSP investments must be converted to a RRIF, an annuity or cash.)

At IC Savings, we offer two options:
•    Variable rate deposits.
•    Fixed-rate terms deposits (1 to 5 years).

With a RRIF, you won’t pay income tax on the entire sum of your savings. Instead, you’ll be taxed at the prevailing marginal tax rate only on the amount that you take as income during that year. (Unlike RRSPs, RRIF planholders must take taxable payments on an annual basis that must meet the minimum levels defined by the Canadian federal government.) The balance of your retirement savings will continue to grow and will remain sheltered from tax.

While you don’t contribute directly to a RRIF, funds can be transferred from another RRIF, an RRSP or an RSP, or a commuted RRSP annuity.
 

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