8.3.4 Video: Taxes and registered savings plans



We could all really use help with our taxes. After paying taxes and our basic living expenses, there never seems to be anything left over. There are a lot of plans (and acronyms) available, though! This video will introduce you to some saving plans you can use to help with your taxes.

Segment 2: Registered plan introduction

For most people, the simplest way to start such a saving/investment/saving plan is with a registered plan like a tax-free savings account or a registered retirement savings plan. They are well known, widely available, and there's one to suit every savings goal.


Registered plans are different from other savings and investment plans because they can give you income tax savings, and, in some cases, the government will even add money to your plan. These savings plans are registered with Revenue Canada and let you reduce or defer income tax.

The main types of registered savings plans are RRSPs (or Registered Retirement Savings Plans)

TFSA (Tax-Free Savings Account)

RESPs (Registered Education Savings Plans)

RDSPs (Registered Disability Savings Plans)

Segment 3: Saving strategy

Let's take a look at the different plans and how they can help you save.


RRSPs are designed to help you save for your retirement. The benefit of this plan is that the money you invest in the plan is deducted from your income, so you don't pay tax on it, right away. And you don't pay tax on earnings in the plan until you withdraw them.

When you decide to use your savings, then you will pay income tax on the money you take out, including any income the savings have earned.

You may pay lower taxes on the money in the plan when you take it out in the future, as most people enter a lower tax bracket after retirement

TFSAs can be used for any savings goal and you can hold cash, stocks, bonds or almost any type of investment in a TFSA. The income the plan earns is not taxed.

RESPs are designed to help you save for your child's education. Money in an RESP can receive grants from the governments of Canada, Quebec and Alberta, which are added to the savings. When the money in the plan is used for the child's education, the money the plan has earned and the grants are considered the child's income, which is often tax-free or taxed at a lower rate.

RDSPs are designed to help you save to support a person with a disability. Money in an RDSP can also receive grants from the Government of Canada, which will add to the savings. And the money the plan receives or earns that is used to support someone with a disability is often taxed at a lower rate.

Many conditions apply to registered savings plans, so be sure you understand them so you can decide if they are the best way for you to meet your savings or investing goals. 


Whatever you are saving for – your retirement, a costly item, a child's education, or support for a person with a disability – registered savings plans can help you achieve your goals, while reducing the current taxes you pay.

Most financial institutions offer a variety of registered savings plans. Talk to your financial institution or to an independent financial professional to decide which plan is best for your goals.

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