This guide is for general information only. It isn’t tax, legal, or financial advice. Programs and contribution limits change, so we recommend confirming how these rules apply to you with a qualified advisor or the Canada Revenue Agency (CRA).
Ten building blocks of a Canadian retirement
Retirement income rarely comes from one source. The guide walks through each program and savings vehicle, what it does, and how they fit together.
Canada Pension Plan (CPP) and Quebec Pension Plan (QPP)
Registered Retirement Savings Plan (RRSP)
First Home Savings Account (FHSA)
Registered Retirement Income Fund (RRIF)
Employer-sponsored plans (RPP, DPSP, group RRSP and TFSA)
Old Age Security (OAS) and Guaranteed Income Supplement (GIS)
Tax-Free Savings Account (TFSA)
Registered Education Savings Plan (RESP)
Life Income Fund (LIF)
Federal withholding tax on withdrawals
Government programs set the baseline
CPP, QPP, and OAS provide a predictable, government-backed floor. They’re designed for stability, not full income replacement, so most people build on top of them.
Contribution-based pension (CPP/QPP)
What you receive reflects your earnings and contributions over your working years.
| Monthly benefit (age 65) | CPP | QPP |
|---|---|---|
| Retirement pension | $1,507.65 | $1,442.25 |
| Survivor’s pension (65+) | $904.59 | $881.48 |
| Death benefit (lump sum) | $2,500.00 | $2,500.00 |
Age and income-based support (OAS/GIS)
OAS starts at age 65. The GIS adds support for lower-income retirees. Both are income-tested.
| Maximum monthly benefit | Amount |
|---|---|
| OAS, ages 65 to 74 | $742.31 |
| OAS, ages 75 and over | $816.54 |
| GIS, single | $1,108.74 |
Note: if your net world income tops $95,323, you may have to repay part or all of your OAS.
Key consideration
Because these programs are income-tested, when and how you draw from other sources can affect both eligibility and the amount you receive. Sequencing your income is a planning decision, not an afterthought.
Four registered accounts, four different jobs
Each account treats tax differently, going in and coming out. Knowing which does what is where most of the long-term value is won.
Contributions lower your taxable income now. Growth is tax-deferred, and withdrawals are taxed as income later.
2026 contribution maximum:
$33,810
Contribute until Dec 31 of this age
71
Funded with after-tax dollars. Growth and withdrawals are tax-free, and withdrawals don’t affect income-tested benefits.
2026 contribution maximum:
$7,000
Cumulative room since inception
$109,000
Tax-deductible contributions like an RRSP, tax-free qualifying withdrawals like a TFSA, for a first home.
Annual contribution cap
$8,000
Lifetime maximum
$40,000
Lifetime limit per beneficiary
$50,000
Maximum lifetime CESG
$7,200
Key consideration
RRSP withdrawals count as income and can affect income-tested benefits, while TFSA withdrawals don’t. Balancing the two over time can help you manage your tax bracket in retirement.
The shift from saving to spending
By December 31 of the year you turn 71, an RRSP has to become income. A RRIF is the most common route, and pension money often flows through a LIF.
Registered Retirement Income Fund (RRIF)
Keep investing while you draw income. Minimum withdrawals are set each year and rise with age. There’s no maximum, and withdrawals are taxable.
| Age | Minimum withdrawal |
|---|---|
| 65 | 4.00% |
| 75 | 5.82% |
| 85 | 8.51% |
| 95 and over | 20.00% |
Life Income Fund (LIF)
Holds money moved from a locked-in pension. Like a RRIF, but with both a minimum and a maximum withdrawal each year, and the limits vary by province.
Note: as of January 1, 2025, Quebec removed the maximum withdrawal limit for those age 55 and older, so only the minimum applies there.
Key consideration:
Because minimum withdrawals climb every year, planning how much to draw (and from where) helps manage your tax exposure and keeps your income steadier over a long retirement.
Two things that quietly move the numbers: workplace and tax details
Employer-sponsored plans can meaningfully bridge the gap government programs leave. And the tax withheld on a withdrawal isn’t the final bill, it’s a prepayment.
2026 employer-sponsored plan limits
| Plan type | 2026 limit |
|---|---|
| Registered Pension Plan (DC) | $35,390 |
| Group RRSP | $33,810 |
| Deferred Profit Sharing Plan | $17,695 |
| Group TFSA | $7,000 |
Federal withholding tax
| Withdrawal amount | Outside QC | Quebec |
|---|---|---|
| Up to $5,000 | 10% | 5% |
| $5,001 to $15,000 | 20% | 10% |
| $15,001 and up | 30% | 15% |
Key consideration:
The withheld amount isn’t your final tax. Depending on your total income for the year, you may owe more or get some back, so timing larger withdrawals carefully can help avoid a surprise at tax time.
Download the full 2026 retirement guide
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