Retirement Planning and Accounts

An overview of tax-deferred accounts including useful planning tools and common FAQ’s

How to Get Started

Whether you're just getting started, living in retirement, or somewhere in between, the steps you can take to ensure you live the lifestyle you planned for are fairly straightforward.

The challenge with retirement planning is determining what your future lifestyle looks like and then dealing with the many variables that go into the process and the pace with which they change.

To help you get started, we've brought together the information you need to consider when you begin to build your retirement plan.


Account Types

Whether you're just starting out in the work force, or well advanced in your retirement planning, Scotia iTRADE is there to support you along the way to help you achieve your retirement goals.

What is a retirement account?
A Registered Retirement Savings Plan lets an individual defer taxes on money saved today. The Canadian government wants to encourage people to save by letting them defer paying taxes until they retire – when most people will be in a lower tax bracket and will pay less tax on those savings. Any money you earn in the RRSP (capital gains, dividends, distributions) is usually exempt from tax during the time the funds remain within the plan. However, you generally have to pay tax when you make withdrawals, or receive payments from the plan.

Retirement products available at Scotia iTRADE
Scotia iTRADE offers both Retirement Savings Accounts and Retirement Income Accounts designed to help make planning for your retirement that much easier. You can choose from:

  • U.S.-Friendly RRSP
  • Registered Retirement Savings Plan Accounts (RRSP)
  • Spousal Registered Retirement Savings Plan Accounts
  • Tax Free Savings Accounts (TFSA)
  • Registered Education Savings Plans (RESP)
  • Registered Retirement Income Fund Accounts (RRIF)
  • Life Income Funds (LIF)
  • Locked-in Retirement Income Funds (LRIF)
  • Locked-in Retirement Accounts or Locked-in RSP (LIRA/LRSP)

Things you need to know about retirement plan accounts
A retirement account isn't like a regular brokerage account. It's set up specifically to help you save for a point in the future. As a result, the Canada Revenue Agency puts a few restrictions on what you can do with a retirement account. Here are some of the more common ones you should be aware of:

  • You can't trade on margin
  • Limits for tax reducing contributions are set by Canada Revenue Agency
    (see your Canada Revenue Agency notice of assessment)
  • Options trading is limited to the purchase of equity and index call and put options, and covered call writing. Naked option writing and spreads are not permitted
  • Canada Revenue Agency requires you to convert your RSP to a RRIF at age 71

It is advisable to consult Canada Revenue Agency for specific issues regarding your registered account.

Scotia Retirement Reality Check
Find out how well your current savings and future contributions will provide for your retirement and learn how to address potential shortfalls.
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RRIF/LIF/LRIF/RLIF Illustration
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Scotia RSP Catch-Up Loan Calculator
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Introduction to: Retirement Savings Accounts

Below is a general description of our registered accounts. This is provided to you for informational purposes only and is not intended to be and should not be construed as tax advice of any kind. Scotia iTRADE does not provide investment advice or recommendations of any kind, including tax advice. Individual circumstances will influence your investment decisions and you should consult with your own tax advisor.

U.S.-Friendly RRSP Account Service
Tired of paying retail foreign exchange "spread" on trades in U.S. securities in your Canadian dollar RRSP? Now you don't have to thanks to our Scotia iTRADE U.S.-Friendly RRSP.

Ready to apply? Open an Account

Registered Retirement Savings Plan (RRSP)
Investing in an RRSP can be a tax-efficient way to help you save for your retirement.

When you contribute to an RRSP you can defer your tax payments on the money you invest until you retire. Once you turn 71, you are required to withdraw your savings or transfer them to a Registered Retirement Income Fund (RRIF), or purchase an annuity.

Ready to apply? Open an Account

Spousal Registered Retirement Savings Plan Accounts
Contributions you make to a spousal or common-law partner RRSP reduce your RRSP deduction limit. The total amount you can deduct for contributions you make to your spouse's RRSP or common-law partner's RRSP and your RRSP cannot be more than your RRSP deduction limit.

If you cannot contribute to your RRSP because of your age, you can still contribute to your spouse's RRSP or common-law partner's RRSP until the end of the year he or she turns 71

Ready to apply? Open an Account

Tax-Free Savings Accounts (TFSA)
Scotia iTRADE® offers the Tax-Free Savings Account (TFSA). Whether you are saving for a new home, a family vacation, or investing for retirement, the TFSA can help you meet your financial goals. A TFSA is a flexible investment account that allows you to invest your money and withdraw your funds for any reason.

Main features and benefits

  • Contribute up to $5,000 each year to a TFSA, regardless of your income.
  • Invest in a wide range of investment vehicles, including stocks, bonds, mutual funds, and cash.
  • TFSA contributions are not tax-deductible, but the investment income you earn on eligible investments is tax-free, even when you make a withdrawal.
  • If you do not contribute the maximum amount, your unused contribution room can be carried forward to any future year. If you contribute more than the maximum amount, your excess contributions will be subject to a penalty tax of one percent per month. You can withdraw funds from your TFSA for any reason, and your withdrawals are tax-free. When you withdraw funds from your account, the withdrawal amount will be added to your contribution limit the following year, which means you do not lose your contribution room when you make a withdrawal.

You are responsible for determining whether your investment is TFSA eligible. Conditions may apply.

For more information, visit the Government of Canada TFSA website: http://www.tfsa.gc.ca/

Ready to apply? Open an Account

Registered Education Savings Plans (RESP)
A Registered Education Savings Plan (RESP) is a special plan that helps you save for a child's studies after high school. Over the years, you put money into the plan and invest it so it will grow.

When you open an RESP, you name someone who will use the money for their education. You can name a child, a grandchild, or any other family member. In some cases, you may be able to name yourself or a friend. The person you name must be a Canadian resident.

The Government of Canada will also put money into the RESP as a grant if your contributing money for a child under the age of 17. Getting a grant is like getting free money towards education. The grants stop at the end of the year when the child turns 17.

Ready to apply? Open an Account

Introduction to: Retirement Income Accounts

Below is a general description of our income accounts. This is provided to you for informational purposes only and is not intended to be and should not be construed as tax advice of any kind. Scotia iTRADE does not provide investment advice or recommendations of any kind, including tax advice. Individual circumstances will influence your investment decisions and you should consult with your own tax advisor.

Registered Retirement Income Funds (RRIF)
A Registered Retirement Income Fund (RRIF) provides you with a set yearly income (minimum required) - determined by you to suit your goals, once you turn 71. Similar to an RRSP, your investments can compound tax-free as long as they remain in your RRIF.

Ready to apply? Open an Account

Self-directed RRIFs
With a self-directed RRIF, you can choose the investments that best suit your retirement objectives. We offer a wide selection of fixed income and mutual fund investment alternatives to help you with your investing and trading needs. There is no annual account administration fee for a RRIF account.

Ready to apply? Open an Account

Life Income Funds (LIF's)
A Life Income Fund (LIF) offers a more flexible alternative to a life annuity for the money that you and your employer have contributed to a pension plan on your behalf. You may transfer your pension funds to a Locked-in Retirement Account (LIRA) at age 55 in most provinces. A LIF will turn your funds into flexible income until the end of the year you turn 80 (except in Quebec, New Brunswick, Nova Scotia, Alberta, Saskatchewan, Manitoba and British Columbia where a LIF has no maximum age), at which time you must purchase a life annuity.

For more information, visit the Government of Canada website

Ready to apply? Open an Account

Locked-in Retirement Income Funds (LRIFs)
A Locked-in Retirement Income Fund (LRIF) is similar to a LIF, with the exception that funds do not have to be converted to a life annuity at age 80.

Ready to apply? Open an Account

Locked-in Retirement Accounts or Locked-in RSP (LIRA/LRSP)
Legislation governing employer-sponsored pension plans generally allows for "portability" of pension rights. This allows an employee who is a member of a registered pension plan and, who is entitled to a deferred pension benefit, terminates employment with the pension plan sponsor/employer, he or she can request the transfer of the accrued value of the deferred pension benefit to a Locked-In RRSP (LIRA).

A LIRA may differ depending on the province in which the pension plan is administered (Federally/Provincially).

A LIRA or locked-in RRSP is similar to an ordinary RRSP, except that it is governed by a "locking-in" agreement which ensures that the transferred pension funds and the subsequent earnings are used to provide periodic retirement income. In other words, it cannot be cashed-in or withdrawn in a lump sum before the specified retirement age.

  1. When will I receive my tax receipts from Scotia iTRADE?
  2. How do I open an RRSP account with Scotia iTRADE?
  3. How do I transfer in my RRSP from another financial institution to Scotia iTRADE?
  4. I have made a deposit to my RRSP; however I have not purchased any securities. What happens to my money?
  5. I have a spousal RRSP account. Who is entitled to the contribution receipt-me or my spouse?
  6. When is the deadline to do an RRSP contribution for the current tax year?
  7. How can I make a contribution to my RRSP?
  8. Can I contribute to my RRSP via Electronic Funds Transfer?
  9. I heard that the Canada Revenue Agency has removed the foreign content rules for RRSP accounts. Is this true?
  10. I noticed on your website that you offer 100 free trades for clients that open new accounts. Does this offer apply to new clients who wish to open an RRSP?
  11. When must I convert my RRSP to a RRIF? How do I go about doing this?
  12. I was charged a Canada Revenue Agency fee on my RRSP statement because I held a non-qualifying investment. What is this?
  13. Canada Revenue Agency has indicated that put options are now eligible as a qualified investments for RRSPs. Can I buy them in my Scotia iTRADE account?
  14. Can I trade options in my RRSP?
  15. I recently transferred my RRSP from another Financial Institution; the securities in my account now have incorrect book values? How do I have this corrected?
  16. Can I open a US-Friendly RRSP account?
  17. I would like to withdrawal funds from my RRSP. How can this be done? Are there any fees involved?
  18. I was told that I could borrow money from my RRSP via the Home Buyers Plan tax free to purchase a house. How does this work?
  19. What is the life long learning plan, and how do I participate?
  20. I still have questions. How do I get in touch with you?
  1. When will I receive my tax receipts from Scotia iTRADE?
    Here are some important dates for the printing of RRSP/RIF contribution receipts, and withdrawal receipts for the season.

    Contribution Receipts
    Contribution Date Mailing Date Receipt Availability Date
    Mar 02/11 – Dec 31/11 Mailed out Daily Prior to month end – January

    ****Contribution receipts for the first 60 days of 2011 are mailed the next business day following the posting of the contribution to your account****

    Income Slips - T4RSP, T4RIF, T4A, Relevé 2, Relevé 1

    Processing Date Availability Date
    Jan 01/11 – Dec 31/11 February 29/2012

    This is a general guideline only. For more detailed advice, taxpayers should refer to the Government regulations and publications below, or contact a Scotia iTRADE service representative.

    Canada Revenue Agency (CRA)
    http://www.cra-arc.gc.ca/menu-e.html
    1-800-959-8281

    Revenue Quebec
    http://www.revenu.gouv.qc.ca/eng/ministere/index.asp
    (514) 873-2600 or 1-866-440-2500

    Due to the complexity of the tax system, please consult with your personal tax advisor for questions regarding your situation. If you have questions about the tax forms you receive, or if you wish to discuss ways in which to minimize your taxable income in 2010, you should speak with your financial consultant1.

  2. How do I open an RRSP account with Scotia iTRADE?

    The easiest way to open an RRSP account is to do it online. Another option is to download our Application for Personal Accounts from our website, and mail to the address below.

    Our mailing address is:
    Scotia iTRADE
    PO Box 4002 Station A
    Toronto, ON
    M5W 0G4

    Or, you can visit us in person and fill in an application form. Our Investor Information Centre is located at:
    Scotia iTRADE
    48 Yonge Street
    Toronto, Ontario
    M5E 1G6

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  3. How do I transfer in my RRSP from another financial institution to Scotia iTRADE?

    If you would like to transfer an RRSP that you hold at another financial institution, please complete the Transfer Authorization for Registered Investments and have it mailed back to us with a current copy of your statement.

    If you are not an existing Scotia iTRADE client, please also complete and return our Application for Personal Accounts form. We will then initiate the transfer for you.

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  4. I have made a deposit to my RRSP; however I have not purchased any securities. What happens to my money?

    Until you invest it, money you contribute to your RRSP account will remain in cash and will earn interest. Details on our credit interest policy are available by clicking here.

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  5. I have a spousal RRSP account. Who is entitled to the contribution receipt - me or my spouse?

    The contributing spouse is the one who receives the contribution receipt. The account holder is entitled to the funds and has authority on the account. The Canada Revenue Agency puts limits on how much can be contributed to a spousal RRSP and determines who has the tax liability if money is withdrawn from a spousal RRSP. More details are available at the CRA website.

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  6. When is the deadline to do an RRSP contribution for the current tax year?

    March 1st, 2012 is the RRSP contribution deadline. During the first 60 days of the year, contributors have the option of claiming the contribution receipt for the previous year or for the current year.

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  7. How can I make a contribution to my RRSP?

    There are several ways that a contribution can be made to an RRSP:

    • Cheque deposit
    • Bill payment
    • Electronic Funds Transfer (if we have your void cheque on file)
    • Transfer of cash from your existing non-registered account
    • You can also do a contribution in-kind, which is a transfer of securities from your existing non-registered account.

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  8. Can I contribute to my RRSP via Electronic Funds Transfer?

    Electronic funds transfer is available for RRSP accounts via our Easy Transfer Service. This enables you to make contributions to your RRSP account but cannot be used deregister funds from your plan. In order to set up Easy Transfer service we require an original void cheque at a Canadian Financial institution, the cheque needs to be embossed with your name. We also require the Easy Transfer Authorization Form.

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  9. I heard that the Canada Revenue Agency has removed the foreign content rules for RRSP accounts. Is this true?

    Yes, it is. The Canada Revenue Agency has removed the foreign content limits, so there are no longer any restrictions on the amount of foreign content you can hold in your RRSP.

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  10. I noticed on your website that you offer 100 free trades for clients that open new accounts. Does this offer apply to new clients who wish to open an RRSP?

    Yes. This offer applies to all new clients who open any kind of account with a minimum of $25,000 worth of equity.

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  11. When must I convert my RRSP to a RRIF? How do I go about doing this?
    An RRSP can be converted to a RRIF at any time; however CRA requires that this must be done no later than December 31 of the year in which you turn 71 years of age. Full details regarding your options can be found at the Canada Revenue Agency website.

    In order to convert an RRSP to a RRIF you must complete an Application for Personal Accounts form. This form needs to be completed and mailed into our office.

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  12. I was charged a Canada Revenue Agency fee on my RRSP statement because I held a non-qualifying investment. What is this?
    Even though the Canada Revenue Agency has removed the foreign content limit there are still some securities that are not eligible for purchase in registered accounts. Most often, this is as a result of the security not trading on one of the prescribed exchanges. Please see Canada Revenue Agency's information regarding qualified investments for further details on prescribed exchanges and RRSP non-qualifying investments.

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  13. Canada Revenue Agency has indicated that put options are now eligible as a qualified investment for RRSPs. Can I buy them in my Scotia iTRADE RRSP account?
    Yes, equity and index put options are now eligible for purchase in your plan account. You'll need approval to trade options in your RRSP. If you haven't previously applied to trade put options in your RRSP, please complete the Options Application Form. Once your account is approved, you may begin trading options in your RRSP account.

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  14. What level of options can I trade in my RRSP?
    There are some types of option trades which can be transacted in plan accounts: The purchase of Calls & Puts as an opening transaction, the selling of Calls & Puts as a closing transaction and the selling of covered Calls. Various levels of options approval are necessary in order to be able to trade options in RRSP accounts. Please click here for more information on the approval process or call (1-888-872-3388).

    Please note: Option spreads, straddles, and uncovered/naked writing are not eligible investments for RRSP.

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  15. I recently transferred my RRSP from another Financial Institution; the securities in my account now have incorrect book values? How do I have this corrected?
    Sometimes when we receive a transfer-in, the transferring firm does not provide the book values of the securities that are transferred in.

    If you believe that your book value is not being reflected properly, please provide us with copies of your most recent statement from the transferring firm, or trade confirmations of your purchase(s). Once we have that information, we'll be pleased to amend the book value for you.

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  16. Can I open a U.S.-Friendly RRSP account?
    Yes, in 2011 Scotia iTRADE introduced the new U.S.-Friendly RRSP. You can trade U.S. equities and options in your Canadian dollar RRSP account without paying retail foreign exchange mark ups or "spread" over and above the SCI Rate* that is applied to the foreign currency component of the trade. For trades in U.S. securities in Scotia iTRADE's U.S.-Friendly Canadian dollar registered accounts on a single trading day, the foreign currency component will be transacted at the single, benchmark, mid-market rate used by Scotia Capital Inc. to price its holdings of US/Canadian dollar currencies at the end of that trading day (SCI Rate). The trade of U.S. securities will continue to settle in Canadian dollars but Scotia iTRADE will not apply its retail markup or "spread" over and above the SCI Rate to the foreign currency component of the trade. Only trades in U.S. securities in the U.S.-Friendly RRSP account will be given this preferential foreign exchange rate. Cash transactions in the account involving the conversion to Canadian dollars of U.S. dollars deposited into these accounts (including U.S. dollar denominated dividends and interest) will be subject to the applicable retail foreign exchange spread charged by Scotia iTRADE at that time. A quarterly fee of $30 (plus applicable taxes) per calendar quarter per registered account will be applied for this account service, regardless of the account balance and trading activity. This fee will be charged at the beginning of each quarter to each registered account that was enrolled in this service at any time during the previous quarter.

    For more information, please click here for important information on foreign exchange transactions, visit Our Fees, under the heading "Fees Charged for Foreign Currency Transactions" and our Help Centre, under the heading "Converting Funds Between Currencies".

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  17. I would like to withdraw funds from my RRSP. How can this be done? Are there any fees involved?
    Funds can be taken out of your RRSP by deregistering them from the plan. To deregister funds you will need to complete the RRSP deregistration form. Please ensure that the funds are available as cash, before submitting the deregistration request. If you do not have cash available, we will not be able to process your request. You will need to decide which security to sell in order for the cash to be available for deregistration.

    There are tax implications when you deregister funds from an RRSP. The current withholding rates are listed below, but please consult your tax specialist regarding your personal tax consequences.

    Withholding Tax Rates: (for all Provinces other than Quebec
    $5,000 or less 10%
    $5,000.01 - $15,000 20%
    Over $15,000 30%

    Withholding Tax Rates: (Quebec Only)
    $5,000 or less 21%
    $5,000.01 - $15,000 26%
    Over $15,000 31%

    Withholding Tax Rates: (US Residents)
    25%
    The fee for a full deregistration is $125 + GST. Alternately, you may request a partial deregistration for a fee of $25 + GST each.

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  18. I was told that I could borrow money from my RRSP via the Home Buyers Plan tax free to purchase a house. How does this work?
    The Home Buyers Plan is a program that allows you to withdraw up to $25,000 from your RRSP to buy or build a qualifying home. For details on what constitutes a qualifying home, please visit the Canada Revenue Agency's Home Buyers Plan information page.

    If you qualify, you'll need to complete form T1036 and mail it to our office, along with a letter of direction telling us what you'd like to do.

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  19. What is the life long learning plan, and how do I participate?
    The Lifelong Learning Plan (LLP) allows you to withdraw up to $10,000 in a calendar year from your RRSP to finance full-time training or education for you, or your spouse, or common-law partner.

    In order to participate in this program you will need to complete form RC96 and mail it to our office, along with a letter of direction telling us where you wish the funds deposited. For more information, please visit the Canada Revenue Agency's Lifelong Learning Plan page.

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  20. I still have questions. How do I get in touch with you?
    If your inquiries are regarding your existing account please contact our Customer Service department at 1-888-872-3388 or email your question to service@scotiaitrade.com.

    If your inquiry is regarding how to open a new account please call to speak to one our Relationship Managers team at 1.888.769.3723 (M-F 8:30am to 5pm EST)

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  • * For trades in U.S. securities in Scotia iTRADE's U.S.-Friendly Canadian dollar registered accounts on a single trading day, the foreign currency component will be transacted at the single, benchmark, mid-market rate used by Scotia Capital Inc. to price its holdings of US/Canadian dollar currencies at the end of that trading day (SCI Rate). The trade of U.S. securities will continue to settle in Canadian dollars but Scotia iTRADE will not apply its retail mark-up or "spread" over and above the SCI Rate to the foreign currency component of the trade. Only trades in U.S. securities in the U.S.-Friendly RRSP account will be given this preferential foreign exchange rate. Cash transactions in the account involving the conversion to Canadian dollars of U.S. dollars deposited into these accounts (including U.S. dollar denominated dividends and interest) will be subject to the applicable retail foreign exchange spread charged by Scotia iTRADE at that time. For important information on foreign exchange transactions, visit Our Fees, under the heading "Fees Charged for Foreign Currency Transactions" and our Help Centre, under the heading "Converting Funds Between Currencies" at www.scotiaitrade.com.
  • 1A quarterly fee of $30 (plus applicable taxes) per calendar quarter per registered account will be applied for this account service, regardless of the account balance and trading activity. This fee will be charged at the beginning of each quarter to each registered account that was enrolled in this service at any time during the previous quarter.
  • 1Scotia iTRADE does not provide investment advice or recommendations of any kind, including tax advice. Individual circumstances will influence your investment decisions and you should consult with your own tax and investment advisor.