In this article:
Overview
Your ability to withdraw from your group account depends on your employer's rules. Some employers don't allow withdrawals while you're employed. Others may require approval or limit how many withdrawals you can make each year.
Your employer sets these withdrawal rules for your group plan. They establish these policies to align with company savings goals or retirement strategies. While your employer controls access, the tax implications of any withdrawal are the same as they would be for a personal account.
Eligibility
To make a withdrawal from your group account, you must:
- Be an enrolled participant in your employer's Group Savings Program.
- Meet the withdrawal criteria set by your employer (for example, tenure or specific approval).
- Have enough available cash in your account to cover the withdrawal.
How to request a withdrawal
If you want to make a withdrawal, follow these steps:
Step 1: Confirm your employer's withdrawal rules
Check your plan documents or contact your HR department.
Step 2: Initiate the withdrawal request
Follow these steps to initiate a withdrawal from your group account:
- Log in to your Wealthsimple app
- Tap your group account
- Tap Transfer money
- Select the destination account
- Tap Next
- Choose the reason for the withdrawal
- Follow the prompts to complete your withdrawal
- Log in to your Wealthsimple profile
- Select your group account
- Select Transfer money
- Choose a bank account to deposit the funds to
- Choose your Reason for withdrawal
- Enter an Amount
- Select Next
- Select Submit to complete your withdrawal
Step 3: Wait while your withdrawal processes
If your employer requires approval for withdrawals, we'll contact them on your behalf after you've made your request. Once approved, we'll process the withdrawal, which typically takes about 5 business days to complete.
Tax implications
Tax implications depend on the type of group account you're withdrawing from:
- Group RRSP: Most withdrawals are considered taxable income and are subject to withholding tax. Exceptions include withdrawals made under the Home Buyers' Plan (HBP) or Lifelong Learning Plan (LLP).
- Group TFSA: You can generally withdraw any amount at any time tax-free, provided your employer's rules allow it.
- Group FHSA: Withdrawals for a qualifying home purchase are tax-free. Non-qualifying withdrawals are taxed as income.
- Group non-registered account: You'll need to pay taxes on any realized capital gains or investment income earned in the account.
Frequently asked questions
Will I lose my contribution room if I withdraw?
For a Group RRSP, you don't get your contribution room back after a withdrawal. For a Group TFSA, the amount you withdraw is added back to your contribution room on January 1st of the following year.
Can my employer see why I am withdrawing money?
If your plan requires employer approval, your employer will be notified of the request. However, you don't typically need to provide a reason for the withdrawal unless your plan specifically requires it for approval.
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