Pension Payments (Retirement Benefits)
You must withhold income tax on a periodic payment from a registered pension plan (RPP), a deferred profit-sharing plan (DPSP) or another pension plan using the usual method.
You must withhold income tax on a single payment from an RPP, a DPSP or another pension plan at the rate applicable to single payments, that is:
- 14% if the payment is $5,000 or less; or
- 19% if the payment is greater than $5,000.
However, you are not required to withhold income tax on a single payment from an RPP, a DPSP or another pension plan that is made to a person who resides outside Québec.
You do not have to withhold income tax on a single payment from an RPP or a DPSP that, without being paid to the beneficiary, is transferred directly to:
- another RPP;
- another DPSP;
- a registered retirement savings plan (RRSP);
- a voluntary retirement savings plan (VRSP);
- a pooled registered pension plan (PRPP);
- a registered retirement income fund (RRIF).
If only a portion of the payment is transferred directly to another plan, you must withhold income tax from the portion that is not directly transferred.