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View Full Version : RRSP withdrawal under HBP & 89-day rule or 90-day rule


lollypopoh
May 27th, 2009, 08:37 PM
So here's what happened to me.
I needed to use my RRSP's for my closing costs to buy my first home under the home buyer's plan. I deposited my RRSP's on Feb 27 this year. I didn't want to pay the penalty by the RRSP 89-day contribution time peridod. ( May 27 is 90 days from the Feb 27, if the end date is included ).

It's pretty complicated story. I actually am closing my condo tomorrow and I wanted to use my RRSP's but at the same time I didn't want to pay the penalty. So I decided to borrow the money from my brother for a few days while to cover the waiting to get the money from RRSP's.

I filled out the T1036 form and took it to the bank last Saturday and explained everything.They said it usually takes 5-10 business days to process it, so they would hold my document until May 27th and then process it. That way I am going to have the money in my account after a few days.

Guess what? I checked my balance today and the funds were in my account. :mad: Today is day 90. Will I have to pay the penalty or since money was in for 89 days period I should be safe?

Some say the RRSP's should be deposited for at least 90 days, others say 89 days. It seems confusing. I am going to call CRA to find out the details. In the mean time does anybody know the answer?

torontosaurus
May 27th, 2009, 08:57 PM
Why not call CRA and ask?

Wonderdollar
May 27th, 2009, 11:00 PM
The funds have to remain in RRSP for 89 days and can be withdrawn the next day, so it seems that you do not have any problem. Moreover, did the bank deduct any tax on the RRSP, if not, they have made sure that the funds were in RRSP for at least 89 days as they have to complete the remaining part of for T 1036. See this link http://www.cra-arc.gc.ca/E/pub/tg/rc4135/rc4135-e.html

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lollypopoh
May 28th, 2009, 05:20 AM
The funds have to remain in RRSP for 89 days and can be withdrawn the next day, so it seems that you do not have any problem. Moreover, did the bank deduct any tax on the RRSP, if not, they have made sure that the funds were in RRSP for at least 89 days as they have to complete the remaining part of for T 1036. See this link http://www.cra-arc.gc.ca/E/pub/tg/rc4135/rc4135-e.html

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Thanks, Wonderdollar! I will doublecheck with CRA and let everyone know.

lollypopoh
May 29th, 2009, 07:50 AM
I talked the person from the CRA and found out I was safe. I am so relieved.:razz: