What tax implications apply when withdrawing funds from my registered account?
For Scotia iTRADE accounts
A withholding tax will be applied and calculated based on your province of residency, the amount you are withdrawing, your tax tier and whether the withdrawal is gross or net. Federal and Provincial tax rates on withdrawals are calculated based on the following tiers:
Gross withdrawals (before withdrawal fee and taxes
- The withdrawal fee (plus sales tax) will be charged to your account. This amount is deducted from the amount entered to determine the taxable amount.
- Withholding taxes are calculated and deducted from the taxable amount.
- The net result will be the amount that you receive, and the entered amount will be withdrawn from your account.
Net withdrawals (after withdrawal fee and taxes)
- The withdrawal fee (plus sales tax) is deducted from the account.
- The taxable amount is the amount entered plus the applicable withholding taxes.
- This taxable amount will be withdrawn from your account, and you will receive the entered amount.
Withholding taxes and any other applicable fees for all withdrawals will be charged in Canadian dollars from the Canadian side of your registered account. You won't be able to continue with the transaction if you don't have sufficient funds in the Canadian side of your account to cover withholding taxes and any other applicable fees.
All provinces (except Quebec) Amount of withdrawal under $5,000 = Federal rate 10% Amount of withdrawal between $5,001 - $15,000 = Federal rate 20% Amount of withdrawal over $ 15,000 = Federal rate 30%
Quebec Amount of withdrawal under $5,000 = Federal rate 5% + Provincial rate* 16% Amount of withdrawal between $5,001 - $15,000 = Federal rate 10% + Provincial rate* 16% Amount of withdrawal over $ 15,000 = Federal rate 15% + Provincial rate* 16%
*Subject to change
- Multiple withdrawals made within the same tax year may be combined, and the withholding tax may be calculated based on the lump sum.
- Sales tax and withholding tax are both based on the Province of the From account.
- Non Resident accounts are not charged sales tax.
- Your account must have enough cash available to cover the full amount being withdrawn.
For ScotiaMcLeod accounts, please contact your advisor.