RRSP/SRSP, RRIF, TFSA and FHSA Account Information

RRSP/SRSP Account Details

A Regular Retirement Savings Plan (RRSP), once registered with the CRA (Canada Revenue Agency), allows the plan holder to invest on a tax deferred basis. Contributions made to the RRSP are tax deductible (up to a limit) and any income or capital gain received inside the RRSP would not be taxed until the money is withdrawn. Interactive Brokers Canada (IBC) clients are limited to opening one regular and one Spousal RSP account (SRSP).

PLEASE NOTE THE FOLLOWING LIMITATIONS

IBC does not offer Locked-in plans or Registered Retirement Income Funds (RRIF). IBC does not accommodate any withdrawals under the Lifelong Learning Plan or any investments in a home mortgage
IBC does not accommodate asset swaps or transfers in kind (cash or securities) from a cash or margin account at IBC or elsewhere to an IBC RRSP, TFSA or FHSA account at this time.
IBC does not support RRSP/TFSA/FHSA outbound or inbound transfers (to or from another financial institution) via Free of Payment (FOP) or Direct Registration Statement (DRS).
IBC does not facilitate RRSP/TFSA/FHSA outbound transfers (to another financial institution) except via the fully-electronic/ATON™ (Account Transfer Online Notification) transfer system.
IBC does facilitate manual or "non-ATON" RRSP/TFSA/FHSA inbound transfers (from another financial institution).
Withdrawals are only available in CAD.

Opening your RRSP Account

Existing eligible IBC clients can add an RRSP and/or SRSP account by logging in to Client Portal, navigating to the User (“head/shoulders” icon) > Settings > Open an Additional Account menu item and selecting RRSP/Spousal RRSP as account type.

New clients may open an RRSP or SRSP account by clicking on the Open Account > Start Application button on the Interactive Brokers Canada website.

Open Account

Please note that you must be a Canadian resident to open an RRSP or a SRSP account.

RRSP/SRSP Age Restrictions

To open an RRSP/SRSP account:

You must be at least 19 years old to open an RRSP/SRSP account in British Columbia, New Brunswick, Nova Scotia and Newfoundland.
You must be at least 18 years old to open an RRSP/SRSP account in Alberta, Saskatchewan, Manitoba, Ontario, Quebec and Prince Edward Island.
IBC does not offer RRIF accounts or annuities, so you must be less than age 69 to open an RRSP/SRSP. The last day you can contribute to an RRSP/SRSP is December 31 of the year you turn 71.

RRSP Account Fees/Maintenance Fee

No account maintenance fee.

Available Retirement Savings Plans

Clients of IBC can open either a Regular Retirement Savings Plan or a Spousal Retirement Savings Plan:

Regular RSP – A client can contribute cash and transfer qualified investments ("in kind") from another registered plan account. (IBC only supports cash contributions and inbound ATON transfers of existing RRSP to start).
Spousal RSP – This is like an RRSP except that the account owner's spouse is allowed to contribute cash to the account. The contributing spouse will get the tax deduction for the tax year while the owner will get the benefit of withdrawing at a potentially lower tax rate when they retire.

Maturity of Plans

RRSPs/SRSPs have a maturity no later than the end of the year in which the annuitant reaches 71 years of age. By the last day of the year in which the IBC client turns 71, funds must be withdrawn or transferred to an RRIF or used to purchase an annuity.

Annual Contribution Limit

The contribution limit for a given tax year is typically displayed on the taxpayer’s notice of assessment produced by the CRA. The contribution limit under the assessment includes unused contribution room for the prior years.

Annual Contribution Deadline

Contributions can be made to RRSP/SRSP accounts at any time during the calendar year or no later than 60 days after the end of the calendar year.

Over-contribution to the plan

Any contribution above the limit will be counted as excess contribution. There is a lifetime allowance of CAD 2,000 for over-contributions. Amounts of over-contribution beyond this limit are subject to a 1% penalty tax per month.

Withholding Taxes

A withdrawal of funds from an RRSP/SRSP constitute a de-registration of the plan and is subject to withholding tax. The tax will be withheld by IBC at the time of the withdrawal. Gross amount of the RRSP/SRSP withdrawal will be included in the T4RSP slip and will be counted towards the general income that one receives for the calendar year.

Account Insurance

The segregated cash portion held with the trustee is insured up to CAD 100,000 (principal and interest combined) by the Canadian Deposit Insurance Corporation (CDIC), which is a Federal government agency that insures Canadians’ savings against the failure of a bank or other CDIC member institution.

RRSP/SRSP accounts are also counted as a separate account for CIPF coverage, and so are eligible for an additional 1M CAD coverage under CIPF.

Beneficiary Designation

The beneficiary information is not applicable to clients who are residents of Quebec where such a designation can only be made by the deceased's last will and testament.

For other provinces, beneficiaries could be either an individual or an estate. If beneficiary chosen is an Estate; then only ONE beneficiary is allowed. If applicant wants multiple beneficiaries, only individuals would be allowed.

RRSP/SRSP Account Trading Permission

Margin trading is not permitted in an RRSP/SRSP. All purchases must be paid in full in respective currencies and account debits are not allowed. If needed, currency trade could be executed between USD and CAD.

Accounts are restricted to cash balances in CAD and USD.

The RRSP account is allowed to trade the following qualified investments:

Stocks listed on designated US and Canadian exchanges (excluding Venture-NEX segment and CSE single listed stocks)
Long equity call options
Long equity put options
Short equity call options with a fully covered position (covered call)
Long equity put options with a fully covered position (protective put).
Long put/call options on indices.
Warrants/Rights if the underlying asset acquired under the right to purchase is a qualified investment.
U.S. Bonds.
FX conversions limited to USD/CAD

RRIF Account Details

A Registered Retirement Income Fund (RRIF) is a taxable retirement income account that lets you convert your Registered Retirement Savings Plan (RRSP) into a source of retirement income while continuing to keep your investments invested and growing on a tax-deferred basis.

An RRIF is particularly useful for Canadians who are ready to begin withdrawing retirement income and want flexibility over the timing and amount of withdrawals.

How RRIFs Work

Once an RRSP is converted into an RRIF, you must begin regular withdrawals. You must withdraw at least a minimum amount each year based on your age at the beginning of the year and the fair market value of the RRIF.

The minimum withdrawal amount is set by the Canada Revenue Agency and increases with age.
You can choose how often you receive payments (monthly, quarterly, semi-annual, or annual).
You may withdraw more than the minimum, but not less.

All amounts you withdraw from your RRIF are taxable in the year you receive them.

RRIF Tax Treatment

Funds inside RRIFs continue to grow tax-deferred until you make a withdrawal.
Withdrawals are added to your taxable income in the year you receive them.
Withholding tax may apply to amounts you withdraw above the annual minimum.

Withholding tax rates vary by the amount and province, and are remitted to the Canada Revenue Agency at the time of payment.

Why Use RRIFs?

An RRIF offers retirees control, flexibility, and ongoing investment growth.

Key benefits:

Maintain investment control and broad choice of qualified investment options
Structure income to match your financial needs
Keep your money invested while generating income
You decide how and when to withdraw amounts above the minimum

An RRIF may also provide options for pension income splitting with a spouse where eligible and can be structured with beneficiaries to reflect estate plans.

Minimum Withdrawal Rules

Each year you must withdraw a prescribed minimum amount based on your age and the value of your RRIF on January 1 of that year.

You may withdraw more than the minimum at any time.
If you withdraw more than the minimum at one time, withholding tax may apply.

The Canada Revenue Agency publishes the factors used to calculate the minimum amount.

RRIF vs Other Retirement Options

RRIF vs RRSP

RRSPs are savings accounts designed for accumulation.
RRIFs are for income generation once you are ready to withdraw funds.

RRIF vs Annuity

RRIFs let you withdraw on your schedule.
Annuities typically provides guaranteed periodic payments but less flexibility.

Getting Started with a RRIF

To set up an RRIF, you typically transfer funds from your RRSP into an RRIF. Once established, you select the withdrawal schedule and begin taking income according to your needs and the minimum rules.

Before opening, consider:

Your retirement income needs
Tax implications of withdrawals
How withdrawals fit with other retirement income sources such as CPP/OAS

Opening Your RRIF

Current IBC clients who are eligible to open a Registered Retirement Income Fund can add an RRIF by logging in to Client Portal, navigating to the User ("head/shoulders" icon) > Settings > Open an Additional Account menu item and selecting Registered Retirement Income Fund (RRIF).

Add an Account

New to IBC?

If you are new to IBC and would like to open an RRIF, click Open Account > Start Application on the Interactive Brokers Canada website.

Open Account

Please note that you must be a Canadian resident to open an RRIF.

Tax-Free Savings Account Details

Tax Free Savings Accounts (TFSAs) are offered by Interactive Brokers Canada for Canadian residents only.

TFSAs allow clients to set money aside tax-free throughout their lifetime. Each calendar year, clients can contribute up to the TFSA dollar limit for the year, plus any unused TFSA contribution room from the previous year and the amount withdrawn the year before.

Investments made inside TFSAs are not taxed.
Withdrawals from TFSAs are not a taxable event.
Contributions to TFSAs are not tax deductible.
There is no upper age limit to maintain a TFSA account.
Can only open an individual account in the name of the plan holder.
IBC does not support RSP/TFSA outbound or inbound transfers (to or from another financial institution) via Free of Payment (FOP) or Direct Registration Statement (DRS).

IBC does not facilitate RSP/TFSA outbound transfers (to another financial institution) except through the fully electronic ATON™ (Account Transfer Online Notification) transfer system.
IBC does facilitate manual or "non-ATON" RSP/TFSA inbound transfers (from another financial institution).

TFSA Fees/Maintenance Fee

No account maintenance fee.

Withdrawals out of TFSA are not subject to additional account specific charges and are only available in CAD.

Opening your TFSA

Current IBC clients who are eligible to open a Tax Free Savings Account can add a TFSA by logging in to Client Portal, navigating to the User ("head/shoulders" icon) > Settings > Open an Additional Account menu item and selecting Tax Free Savings Account (TFSA).

Add an Account

New clients may open an TFSA by clicking on the Open Account > Start Application button on the Interactive Brokers Canada website.

Open Account

Please note that you must be a Canadian resident to open a TFSA.

TFSA Contribution Limit

Year	Annual Contribution Limit
2009	CAD 5000
2010	CAD 5000
2011	CAD 5000
2012	CAD 5000
2013	CAD 5500
2014	CAD 5500
2015	CAD 10000
2016	CAD 5500
2017	CAD 5500
2018	CAD 5500
2019	CAD 6000
2020	CAD 6000
2021	CAD 6000
2022	CAD 6000
2023	CAD 6500
2024	CAD 7000
2025	CAD 7000
2026	CAD 7000

A penalty of 1% per month will be assessed by the CRA on excess contribution.

Please review the available amounts specific to each taxpayer by logging into CRA Portal. Interactive Brokers doesn't monitor the overall TFSA contribution room and any excess contribution above the CRA allowed limit is subject to overcontribution penalty.

TFSA Trading Permission

Trading in a TFSA is subject to the following restrictions:

No margin trading. All purchases must be paid in full in the applicable currency. Account debits are not permitted.
Currency trading is limited to USD and CAD. If required, FX conversions may be executed between USD and CAD only.
Cash balances are restricted to CAD and USD.

A TFSA may trade the following qualified investments:

Stocks listed on designated U.S. and Canadian exchanges, excluding the Venture-NEX segment and CSE single-listed stocks
Long equity call options
Long equity put options
Short equity call options when fully covered by the underlying position (covered calls)
Long equity put options when fully covered by the underlying position (protective puts)
Long put and call options on indices
Warrants and rights, provided the underlying asset acquired under the right to purchase is a qualified investment
U.S. bonds

Account Insurance

A TFSA account is considered part of a client's general account for purposes of CIPF coverage. Therefore, a TFSA will be combined with other (Non-RSP) IBC accounts eligible for $1 million coverage.

Successor Holder

A TFSA account holder may designate a spouse or common-law partner as successor holder. Upon the death of the original account holder, the spouse or common-law partner becomes the new account holder.

If a successor holder is not designated, the account holder may instead name a beneficiary.

Successor holder designation is not available for Quebec-based TFSA accounts.

FHSA Account Details

A First Home Savings Account (FHSA) is offered by Interactive Brokers Canada (IBC) for Canadian residents only.

A FHSA helps Canadian citizens who are “first time home buyers” save for a home with tax advantages. Each calendar year, clients can contribute up to CAD 8,000 towards a future home purchase. In addition, clients can carry forward up to CAD 8,000 of unused contribution from the previous year to the current year, increasing the current year’s contribution limit to a maximum of CAD 16,000.

The maximum lifetime contribution to a FHSA is CAD 40,000.
You must use your FHSA contribution within 15 years of opening the account or by the time you turn 71, whichever is sooner.
After 15 years of opening the account or turning age 71, the FHSA savings can be transferred to an RRSP. Please note that IBC does not offer Registered Retirement Income Funds (RRIF) accounts.

Transfers from your RRSP to your FHSA reduce the amount that can be deducted over your lifetime.
Should you exceed your contribution limit, there is a penalty of 1% per month on the amount of contribution that exceeds your contribution limit.

A first-time home buyer for a FHSA is someone who hasn’t lived in a qualifying home in the past four years or in the year the account is opened. A qualifying home is a housing unit in Canada, including shares of a co-op housing corporation.

Withdrawals can be made for a qualifying home purchase and require Form RC725 be submitted at the time of the withdrawal request. Designated withdrawals to transfer over contributions require Form RC727 be submitted at the time of the withdrawal request.

Additional information about First Home Savings Accounts, including the implications of a taxable withdrawals, are available from the Government of Canada.

Opening Your FHSA

Existing eligible IBC clients can add an FHSA by logging in to Client Portal, navigating to the User ("head/shoulders" icon) > Settings > Open an Additional Account menu item and selecting First Home Savings Account / FHSA.

Add an Account

New clients may open FHSA by clicking on the Open Account > Start Application button on the Interactive Brokers Canada website.

Open Account

Please note that you must be a Canadian resident to open a FHSA.

FHSA Trading Permission

Margin trading is not permitted in a FHSA. All purchases must be paid in full in respective currencies and account debits are not allowed. If needed, a currency trade can be executed between USD and CAD.

Accounts are restricted to cash balances in CAD and USD.

FHSAs are allowed to trade the following qualified investments:

Stocks listed on designated US and Canadian exchanges (excluding Venture-NEX segment and CSE single listed stocks)
Long equity call options
Long equity put options
Short equity call options with a fully covered position (covered call)
Long equity put options with a fully covered position (protective put).
Long put/call options on indices.
Warrants/Rights if the underlying asset acquired under the right to purchase is a qualified investment.
U.S. Bonds.
FX conversions are limited to USD/CAD

FHSA Fees/Maintenance Fee

There is no FHSA maintenance fee.

Withdrawals from a FHSA are not subject to additional account specific charges and are only available in Canadian dollar (CAD).