RRSP - moving them back to Ireland

lydiabehan

Hey guys,

Does anyone have experience of cashing out their RRSP's when moving back to Ireland.

I'd like to contribute to my RRSP but am worried about the implications if I decide to move home in the future. I understand that as a non-resident of Canada, they withhold 25% tax on the RRSP. But what happens with the income in Ireland? Do you get taxed again?

If not, I'm thinking it makes sense to contribute as I'll gain my marginal tax rate - 25% withholding taxes.

Has anyone else done this before?

Thanks!

gendrol75

Old thread, I know, but I've recently been trying to find out about this as well.

According to my accountant's tax expert, any RRSP withdrawal brought into Ireland is considered income by both the Canadian and Irish governments. As you mention, the Canadian gov't takes 25% off the top (automatically, at the time of withdrawal). But the amount must also be reported to the Irish gov't, who will charge my marginal rate (52% effectively, giving credit for the 25% already paid). See also this Irish Times article, which says much the same thing.

I was hoping to be able to use my RRSP balance as a deposit on a house in Ireland. I could maybe stomach a 25% haircut, but 52% is crazy. Unfortunately.

As an alternative, the same tax person advises that TFSA withdrawals are tax free on both sides. This is because your TFSA lodgements (unlike RRSP) were made with after-tax funds. So withdrawals are not considered income by either party.

Fake Tales

I'm in the same position. I guess it is the same as in Canada except you can no longer avail of the "loan" from your rrsp for first time house buyers. One way to take the money out might be to do it in the year you move home when your income may be low if you move mid year?