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Posted Sat, 18 Mar 2023 20:58:12 GMT by Brian Lerner
I am currently tax resident in Canada but am planning to move back to the UK in the next few years. If I save in a Canadian RRSP and then leave the funds invested in the RRSP until retirement age will I be taxed in the UK on any dividend income or capital gains on the funds held in the RRSP before I commence withdrawals.
Posted Thu, 23 Mar 2023 15:26:17 GMT by HMRC Admin 19

The guidance at DT4617 below, advises that, where a UK resident makes a lump sum withdrawal from an Registered Retirement Savings Plan (RRSP) or an Registered Retirement Income Funds (RRIF), Canada imposes a 25 per cent withholding tax. 

DT4617 - Double Taxation Relief Manual: Guidance by country: Canada: Withdrawals from Canadian RRSPs/RRIFs

No tax credit relief is allowable, which means that the full lump sum is taxable in both Canada and the UK. You can, however, claim Foreign Tax Credit Relief of up to 100% of the foreign tax deducted, against your UK tax liability.

Thank you.
Posted Thu, 23 Mar 2023 16:03:42 GMT by Brian Lerner
Thank you for this reply. However I was seeking confirmation that I will not be taxed on the income or capital gains which accrue on the funds invested in the RRSP after I return to the UK but before I commence withdrawals from the RRSP. Could you please provide further guidance. Many thanks
Posted Wed, 29 Mar 2023 16:01:28 GMT by HMRC Admin 20
Hi Brian Lerner,

If these are just added to the fund to give you a better pension when you do withdraw it, then no, it will all be taxed at the point of withdrawal.

Thank you.
Posted Tue, 18 Apr 2023 10:34:29 GMT by bp5
Dear HMRC Admin, To help me understand your answer could you give me the answer with respect to this concrete example? Suppose an original investment of CAD 5000 in an RRSP is now worth CAD 10000. If a person who is tax resident in the UK wishes to withdraw the whole amount, it appears the Canada Revenue Agency will take CAD 2500 withholding tax, leaving CAD 7500. How much of this is taxable in England and at what rate? Thanks in anticipation.
Posted Tue, 25 Apr 2023 13:29:15 GMT by HMRC Admin 10
You will declare the gross income received and then claim foreign tax credit relief for the tax paid in Canada (if applicable).
The rate of  tax to pay in the UK is dependant on your level of income.
Posted Wed, 26 Apr 2023 12:34:25 GMT by Brianj
I have the same issue as the previous person. How do I go about reporting a Canadian RRSP withdrawal in a Self Assessment? I am also curious about your answer regarding reporting the full amount (gross income). The previous post describes investing $5000.00 to receive a profit of $5000.00. Wouldn't you declare the profit and not the entire amount? Thanks in advance.
Posted Thu, 04 May 2023 07:33:47 GMT by HMRC Admin 25
Hi Brianj,

Please refer to guidance here:

DT4617 - Double Taxation Relief Manual: Guidance by country: Canada: Withdrawals from Canadian RRSPs/RRIFs

Thank you. 


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