Withdrawing from your RRSP before retirement is almost always costly from a tax perspective. The financial institution withholds tax at the time of withdrawal - 10% on amounts up to $5,000, 20% on amounts between $5,001 and $15,000, and 30% on amounts above $15,000 (different rates apply in Quebec). But the withholding is just an installment; the full withdrawal is added to your income for the year and taxed at your marginal rate. If that rate is higher than the withholding rate you will owe more at tax time. Additionally, withdrawn contribution room is permanently lost (unlike TFSA withdrawals). This calculator shows your gross withdrawal, estimated withholding tax, the balance added to your income, and the total tax cost in your province.