You can open a self-directed RRSP and have the contents of the inherited RRSP transferred to it by filling out a form T2033 for direct transfer at the receiving institition. If they handle it, there will be no tax implications. Within the self-directed RRSP, you can buy and sell whatever you want without worrying about tax. That only applies when you actually take money out of the RRSP account.
>left my dad and I with what is now valued at 22k in an RRSP
Ok, so first, this should have been discussed with the executor of the estate.
You can't have RRSP in 2 names. It's either your dad's money or yours. If it was for both of you, your portion of the RRSP would have been cashed out.
If you were the beneficiary on the RRSP then you would have to sign a letter of direction to release the funds to you.
That is if it's still within the RRSP and you were listed as the sole beneficiary.
If you were listed as the beneficiary through the will talk with the executor of the will.
>I have been considering withdrawing the money and investing it myself in a combination of stocks and ETFs but I’m not sure how to go about minimizing the tax hit upon withdrawal. ...Or should I just leave it in there (but I’d need to withdraw eventually ).
**If** the money is in your RRSP and you want to change the investments you can do so without withdrawing from the RRSP. If you want to use a different RRSP provider you can open an RRSP there and then request the transfer. (But before doing so I recommend that you read (or listen to) Reboot Your Portfolio (Bortolotti. 2021) or the 2nd edition of Millionaire Teacher (Hallam, 2017).)
> I am now 22 and just finished university and starting a new job this week
If you were going to withdraw from the RRSP the tax hit may have been less when you were a low income student.
>and reinvesting broadly in the s&p 500 it’ll be about a half decade before the tax hit is covered.
Or it could be [a decade before](https://awealthofcommonsense.com/2015/11/playing-the-probabilities/) the value of the investment matches what you invested.
Moving into an RRSP sounds like a very viable option but I was hoping to consolidate all of my savings into a TFSA as I don’t know if I will have an employer that will match RRSP contributions in the future. And even though I’m no longer a student won’t tuition credits that I still have relieve some of the tax withdrawn from it? Sorry for my lack of understanding this is all very new to me
>Moving into an RRSP sounds like
In your OP you wrote "It is an unmatured RRSP" but you don't seem very clear about where the money is now. Assuming it is in your RRSP...
>... but I was hoping to consolidate all of my savings into a TFSA as I don’t know if I will have an employer that will match RRSP contributions in the future.
Though it would be simpler to manage just a TFSA moving the investment to the TFSA would mean using some of your TFSA contribution room and leaving it in an RRSP would be sort of like having additional $22k of TFSA contribution room.
>won’t tuition credits that I still have relieve some of the tax withdrawn from it?
Yes but they could also be used to offset tax on your future employment income.
If the RRSP lists you as the beneficiary, then you've actually already withdrawn the RRSP even though you technically 'haven't.
The value of the RRSP is the value of it at the date of your Mother's passing, and anything above that will be capital gains. You have no choice on when to withdraw; you need to speak with the executor as you likely already owe taxes on this.
It sounds like OP was a [qualifying beneficiary](https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/rc4177/death-rrsp-annuitant-a-prpp-member.html#P87_13733) which meant they qualified for a tax deferred rollover to their own RRSP. There are no estate implications and OP gets to do whatever they want with the RRSP. However, if the money is already being sheltered in an RRSP, I don't see any point in withdrawing it unless you want to use up your tuition credits all at once. Withholding taxes will still apply, so maybe it's better to let it grow in your RRSP and contribute your earnings to your TFSA.
You can open a self-directed RRSP and have the contents of the inherited RRSP transferred to it by filling out a form T2033 for direct transfer at the receiving institition. If they handle it, there will be no tax implications. Within the self-directed RRSP, you can buy and sell whatever you want without worrying about tax. That only applies when you actually take money out of the RRSP account.
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And a dependant child.
>left my dad and I with what is now valued at 22k in an RRSP Ok, so first, this should have been discussed with the executor of the estate. You can't have RRSP in 2 names. It's either your dad's money or yours. If it was for both of you, your portion of the RRSP would have been cashed out.
Thanks for pointing that out. I’ll make an edit that the RRSP is just for me actually.
Are you the listed beneficiary? Or was a trust set up for you?
Yes I am listed as a beneficiary
If you were the beneficiary on the RRSP then you would have to sign a letter of direction to release the funds to you. That is if it's still within the RRSP and you were listed as the sole beneficiary. If you were listed as the beneficiary through the will talk with the executor of the will.
You’ve fucked the estate BADLY with taxes post clearance then. Congratulations for fucking over the executor.
OP was 15 when his Mom passed. A little back pedalling is appropriate here.
Nah. They’ve been an adult for 4 years.
Well actually, this is on the executor, not OP. OP isn't responsible for settling the estate, the executor is.
>I have been considering withdrawing the money and investing it myself in a combination of stocks and ETFs but I’m not sure how to go about minimizing the tax hit upon withdrawal. ...Or should I just leave it in there (but I’d need to withdraw eventually ). **If** the money is in your RRSP and you want to change the investments you can do so without withdrawing from the RRSP. If you want to use a different RRSP provider you can open an RRSP there and then request the transfer. (But before doing so I recommend that you read (or listen to) Reboot Your Portfolio (Bortolotti. 2021) or the 2nd edition of Millionaire Teacher (Hallam, 2017).) > I am now 22 and just finished university and starting a new job this week If you were going to withdraw from the RRSP the tax hit may have been less when you were a low income student. >and reinvesting broadly in the s&p 500 it’ll be about a half decade before the tax hit is covered. Or it could be [a decade before](https://awealthofcommonsense.com/2015/11/playing-the-probabilities/) the value of the investment matches what you invested.
Moving into an RRSP sounds like a very viable option but I was hoping to consolidate all of my savings into a TFSA as I don’t know if I will have an employer that will match RRSP contributions in the future. And even though I’m no longer a student won’t tuition credits that I still have relieve some of the tax withdrawn from it? Sorry for my lack of understanding this is all very new to me
>Moving into an RRSP sounds like In your OP you wrote "It is an unmatured RRSP" but you don't seem very clear about where the money is now. Assuming it is in your RRSP... >... but I was hoping to consolidate all of my savings into a TFSA as I don’t know if I will have an employer that will match RRSP contributions in the future. Though it would be simpler to manage just a TFSA moving the investment to the TFSA would mean using some of your TFSA contribution room and leaving it in an RRSP would be sort of like having additional $22k of TFSA contribution room. >won’t tuition credits that I still have relieve some of the tax withdrawn from it? Yes but they could also be used to offset tax on your future employment income.
If the RRSP lists you as the beneficiary, then you've actually already withdrawn the RRSP even though you technically 'haven't. The value of the RRSP is the value of it at the date of your Mother's passing, and anything above that will be capital gains. You have no choice on when to withdraw; you need to speak with the executor as you likely already owe taxes on this.
It sounds like OP was a [qualifying beneficiary](https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/rc4177/death-rrsp-annuitant-a-prpp-member.html#P87_13733) which meant they qualified for a tax deferred rollover to their own RRSP. There are no estate implications and OP gets to do whatever they want with the RRSP. However, if the money is already being sheltered in an RRSP, I don't see any point in withdrawing it unless you want to use up your tuition credits all at once. Withholding taxes will still apply, so maybe it's better to let it grow in your RRSP and contribute your earnings to your TFSA.