RRSP explained: contribution room, deadline, refund and withdrawal tax in 2026
The RRSP is the account most Canadians have heard of and few can explain. It comes down to five things: how much you can put in, by when, what you save, what it costs to take money out, and what happens at 71. Here is each one with the CRA numbers and a calculator.
On this page
RRSP room, refund and withdrawal calculator
What an RRSP contribution saves, and what a withdrawal costs
Room uses the CRA formula: unused room plus the lesser of 18% of 2025 earned income and $33,810, minus your pension adjustment (PAR and PSPA ignored). Withholding uses the CRA rates for residents: 10%, 20% or 30% (5%, 10% or 15% in Quebec) depending on the withdrawal size. Tax rates are inputs you choose, not forecasts. Your exact limit is on your notice of assessment.
How RRSP contribution room works
The CRA works out your RRSP deduction limit for a year as:
- your unused room carried forward from earlier years, plus
- the lesser of 18% of last year's earned income and the year's dollar limit, minus
- your pension adjustment (PA) if you are in a workplace pension or DPSP.
| Tax year | RRSP dollar limit | Earned income needed to reach it |
|---|---|---|
| 2025 | $32,490 | $180,500 in 2024 |
| 2026 | $33,810 | $187,833 in 2025 |
| 2027 | $35,390 | $196,611 in 2026 |
The last column is the dollar limit divided by 18%. Below that income, your new room is just 18% of earned income: someone who earned $80,000 in 2025 gets $14,400 of new 2026 room. Unused room never expires. Earned income is mostly employment and self-employment income; investment income does not count. Our guide to what counts as earned income lists both sides, and the RRSP limit 2027 guide has a room calculator by year.
Your exact limit is printed on your notice of assessment and in your CRA account. Going over by more than $2,000 triggers a tax of 1% a month on the excess until you remove it or new room covers it.
The RRSP deadline
Contributions made in the first 60 days of a year can be deducted on the previous year's return. For the 2025 tax year the CRA's deadline was March 2, 2026. For the 2026 tax year the 60th day of 2027 is Monday, March 1, 2027; the CRA usually confirms it in January. You do not have to deduct a contribution right away: you can report it on Schedule 7 and carry the deduction forward. The first 60 days guide covers the details.
The last day you can contribute to your own RRSP is December 31 of the year you turn 71. There is no January grace period after that.
How the tax refund works
A contribution you deduct lowers your taxable income by the same amount, so the tax saved is your marginal rate on the deduction. The money is not tax-free; tax is deferred until you withdraw.
| Step | Arithmetic | Result |
|---|---|---|
| Jordan's new 2026 room (earned $80,000 in 2025) | $80,000 × 18% | $14,400 |
| Plus unused room | $14,400 + $10,000 | $24,400 limit |
| Contribution deducted | $6,000 | fits |
| Tax saved at a 30% marginal rate | $6,000 × 30% | about $1,800 |
Whether that comes back as a refund depends on how much tax was already withheld from your pay. A lower net income can also raise income-tested benefits such as the Canada Child Benefit, since they use line 23600. Your bracket is in our 2026 tax brackets guide.
Withdrawals: withholding and the real tax
Take money out of an RRSP (outside the HBP or LLP) and the institution withholds tax right away, based on the size of the withdrawal:
| Amount withdrawn | Withholding (outside Quebec) | Withholding in Quebec (federal) |
|---|---|---|
| Up to $5,000 | 10% | 5% |
| Over $5,000 up to $15,000 | 20% | 10% |
| Over $15,000 | 30% | 15% |
In Quebec, provincial tax is withheld as well. Withholding is a prepayment, not the final bill. The full withdrawal is added to your income for the year. Example: Jordan withdraws $8,000. The bank withholds 20%, or $1,600. At a 30% marginal rate the tax is about $2,400, so roughly $800 more is due at tax time. Splitting it into two $4,000 withdrawals lowers the withholding to 10% each, but not the tax owed. Non-residents face 25% unless a treaty reduces it. The RRSP withdrawal tax guide goes deeper.
One more difference from a TFSA: the CRA's room formula has no line that adds a regular withdrawal back. Our RRSP vs TFSA guide compares the two side by side.
Home Buyers' Plan and Lifelong Learning Plan
Two programs let you take money out with no tax withheld, as long as you pay it back:
| Home Buyers' Plan (HBP) | Lifelong Learning Plan (LLP) | |
|---|---|---|
| For | Buying or building a qualifying first home | Full-time training or education for you or your spouse |
| Limit | $60,000 per person | $10,000 a year, $20,000 per participation |
| Repay over | 15 years | generally 10 years |
| Start | 5th year after for first withdrawals 2022 to 2028, otherwise 2nd | Per the CRA's LLP chart |
| Missed repayment | Added to your income for that year | |
An LLP withdrawal over $10,000 in a year has tax withheld on the excess, and contributions made in the 89 days before an LLP withdrawal may not be deductible. The HBP schedule, with a calculator, is in our HBP repayment guide.
What happens at 71
An RRSP generally has to mature by December 31 of the year you turn 71. You then withdraw it (fully taxable that year), transfer it to a RRIF, or buy an annuity. The RRSP issuer does not withhold tax on amounts moved directly to a RRIF or used to buy an annuity. A RRIF then has a required yearly minimum; our RRIF minimum withdrawal guide has the CRA factor table and a calculator. If your spouse or common-law partner is younger, you can keep contributing to a spousal RRSP until the end of the year they turn 71.
Options people compare
| Option | What it does | Watch for |
|---|---|---|
| Deduct this year | Saves tax at today's marginal rate | Best when your rate is high now |
| Contribute now, deduct later | Saves the deduction for a higher-income year | Report it on Schedule 7 |
| TFSA instead | No deduction, tax-free withdrawals, room comes back | $7,000 of new room for 2026 |
| FHSA first for a home | Deductible and tax-free on a qualifying withdrawal | $8,000 a year, $40,000 lifetime |
Looni does not recommend investments or accounts; these are the trade-offs people weigh. More calculators are on the tools page.
How to use your RRSP room for the 2026 tax year
- Find your 2026 RRSP deduction limit on your 2025 notice of assessment or in your CRA account.
- Subtract any contributions since March 3, 2026 that you have not deducted.
- Contribute by Monday, March 1, 2027, and keep the receipt.
- Claim the deduction on line 20800, or report it on Schedule 7 and carry it forward.
- Before any withdrawal, check the withholding rate and set aside the extra tax you may owe.
- Mark December 31 of the year you turn 71 as the date your RRSP must mature.
Questions people ask
How is RRSP contribution room calculated?
The CRA adds your unused room from earlier years to the lesser of 18% of your previous year's earned income and the annual dollar limit, then subtracts any pension adjustment. Your exact limit is on your notice of assessment.
What is the RRSP limit for 2026?
The 2026 RRSP dollar limit is $33,810. The 2027 limit is $35,390. Your personal limit is lower if 18% of your earned income is below the dollar limit.
What is the RRSP deadline for the 2026 tax year?
Contributions made in the first 60 days of 2027 can be deducted on your 2026 return. The 60th day is Monday, March 1, 2027. The CRA usually confirms the date in January.
How much tax is withheld on an RRSP withdrawal?
For residents outside Quebec, 10% on amounts up to $5,000, 20% on amounts over $5,000 up to $15,000, and 30% over $15,000. In Quebec the federal rates are 5%, 10% and 15%, and provincial tax is also withheld.
Is the withholding tax the final tax on an RRSP withdrawal?
No. The full withdrawal is added to your income for the year. If your marginal rate is higher than the withholding rate, you owe the difference when you file.
What happens if I over-contribute to my RRSP?
The CRA charges 1% a month on contributions that exceed your deduction limit by more than $2,000, until you remove the excess or new room covers it.
What happens to my RRSP when I turn 71?
It generally has to mature by December 31 of the year you turn 71. You can withdraw it, transfer it to a RRIF or buy an annuity. Direct transfers to a RRIF have no tax withheld.
How much can I take out under the Lifelong Learning Plan?
Up to $10,000 a year and $20,000 in total each time you participate, with no tax withheld if you meet the conditions. You generally repay it over 10 years.
Looni reads your statements and flags bank fees, forgotten subscriptions and interest you may be paying without noticing, so more of your income can go into the accounts you choose. Read-only, no advice.
Sources
Canada Revenue Agency, MP, DB, RRSP, DPSP, ALDA, TFSA limits (RRSP dollar limits $32,490 for 2025, $33,810 for 2026, $35,390 for 2027; TFSA $7,000), How contributions affect your RRSP deduction limit (18% formula, pension adjustment, unused room), Guide T4040 (1% a month over $2,000, Schedule 7), Important dates for RRSPs (March 2, 2026 deadline for 2025, December 31 of the year you turn 71), Tax rates on withdrawals (10/20/30%, Quebec 5/10/15%, non-residents 25%), Lifelong Learning Plan withdrawals ($10,000 a year, $20,000 total, no withholding, 10 years, 89-day rule), The Home Buyers' Plan ($60,000, relief for 2022 to 2028 first withdrawals) and Options for your own RRSPs (maturity at 71, no withholding on transfers to a RRIF or annuity). The FHSA figures are from our CRA-sourced FHSA guide. The March 1, 2027 date applies the 60-day rule; the Jordan example is illustrative and the arithmetic is ours.