As a Canadian expatriate, you may wonder whether you can continue your Registered Retirement Savings Plan or RRSP contributions while vivir en el extranjero.
RRSPs are a popular investment vehicle for Canadians to save for retirement, offering tax benefits and long-term growth opportunities.
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Understand that the rules regarding contributions to RRSPs for Canadian expats can be complex and depend on various factors.
Understanding RRSP Contributions
RRSPs are tax-advantaged accounts designed to help Canadians save for retirement.
Contributions to RRSP Canada are tax-deductible, meaning they can reduce your taxable income, and investment earnings within the RRSP are tax-deferred until withdrawal.
Can I contribute to RRSP if I live outside Canada?
Canadian expats can continue to contribute to their RRSPs as long as they have “earned income” as defined by the Canadian tax laws, up to a certain limit each year.
Earned income generally includes employment income, business income, rental income, and spousal support, among others.
However, passive income such as dividends, interest, or pensions income may not be considered as earned income for RRSP contribution purposes.
Can I keep my RRSP if I leave Canada?
Canadian expats can maintain their existing RRSP accounts while living abroad.
It’s important to keep in mind that the tax treatment of RRSP contributions and withdrawals may vary based on the tax treaty between Canada and the expat’s country of residence.
Additionally, some countries may not recognize the tax-deferred status of RRSPs, potentially subjecting them to local taxation.
Pros and Cons of RRSPs in Canada
Benefits of RRSP Contributions

Continuing to contribute to an RRSP as a Canadian expat can offer several benefits, including:
- Tax Deferral: Contributions to an RRSP can help reduce current taxable income, providing immediate tax benefits.
- Retirement Savings: RRSPs offer a tax-efficient way to save for retirement, allowing investments to grow tax-free until withdrawal.
- Homeownership: RRSP contributions can be used for a first-time home purchase through the Home Buyers’ Plan, providing a tax-advantaged way to fund a down payment.
RRSP Disadvantages
- Withdrawals from an RRSP are subject to ordinary income tax, possibly at a higher marginal rate than at the time of contributions.
- Government benefits like Old Age Security may be trimmed when funds from RRSP are withdrawn.
- They typically have penalties for premature withdrawal and are difficult to access prior to retirement.
- The plan must be terminated prior to the end of the year you turn 71.
Examples of Earned Income for RRSP Contribution Eligibility
Earned income plays a crucial role in determining eligibility for contributing to a Registered Retirement Savings Plan for Canadian expats.
Here are some examples of earned income that may qualify for RRSP benefits eligibility:
- Employment Income: Salaries, wages, bonuses, commissions, and other forms of compensation received from employment are generally considered earned income for RRSP contribution purposes. This includes income earned from both Canadian and foreign employment.
- Self-Employment Income: Profits from a self-employed business, including freelance work, consulting fees, and business income, are typically classified as earned income, making self-employed individuals eligible to contribute to their RRSPs based on their net income from self-employment.
- Rental Income: Net rental income from inmobiliario properties can be considered earned income for RRSP contribution eligibility. However, it’s important to note that passive rental income may not qualify as earned income for RRSP contributions in certain cases.
- Spousal Support: Alimony or spousal support payments received as a result of a legal agreement or court order may be considered earned income for RRSP contribution purposes.
- Maternity and Parental Benefits: In some cases, maternity and parental benefits received from government programs may be classified as earned income for RRSP contribution eligibility.
- Taxable Scholarships and Fellowships: Certain types of taxable scholarships, fellowships, and bursaries may qualify as earned income, allowing recipients to contribute to their RRSPs.
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Adam es un autor reconocido internacionalmente en temas financieros, con más de 830 millones de respuestas en Quora, un libro muy vendido en Amazon y colaborador de Forbes.