Shinhan Plans

Shinhan Tax-Free Savings Accounts (TFSA)

In Jan, 2009, the Canadian government introduced a registered savings vehicle called the “TFSA” to allow Canadians to earn tax free investment income to meet lifetime savings needs more easily. Any income earned within a TFSA account is tax-free.
Corporations and businesses are not eligible to register for a TFSA.
100% of the investment income earned in a TFSA account up is tax free. Unlike RRSPs, withdrawals from TFSA are also tax-free.
Unlike RRSP, contributions to a TFSA account are made with after-tax income. Although contributions to a TFSA account are not eligible for tax-deduction benefits, neither investment income nor withdrawals are subject to tax.
Any unused contribution room in a TFSA is carried forward indefinitely.
There is a penalty of 1% per month on any amounts exceeding the contribution limit.


2009 Jan 1            $5,000 contribution made to a TFSA account

2009 Sep 1           Additional contribution of $2,000 to the same TFSA account

2009 Dec 2           Withdrawal of $2,000 from TFSA to avoid over-contribution penalty

Calculation of total penalty

$2,000(over-contribution) x 1% x 4 (Sept-Dec) = $80

TFSA Term Deposit

3 month, 6 month, 1 year, 2 year, 3 year, 4 year, 5 year
Minimum Deposit
Partial Withdrawal
Fixed interest
(Simple interest at maturity based on the number of days from deposit to maturity)
Maturity Options
Automatically renewed at maturity
Deposit Insurance
CDIC provides deposit insurance for deposits of up to CAD 100,000 (sum of both interest and principal).  Please visit for more details.

TFSA Shinhan Free Installment Saving

6 months ~ 3 years
Monthly Deposit Options
$ 10 ~ $10,000
After ¾ of account term has passed, you cannot make contributions exceeding ½ of the original balance
Monthly contribution only
TFSA monthly deposit options are the same You can make monthly deposits similar to that of regular installment savings
Interest payment at termination = Monthly deposit * interest rate at termination * maturity/365
Maturity is the number of days between the account creation date and termination date
Interest paid on accounts terminated early after 30 days will use the savings account interest rate
Partial withdrawal
Maturity date shall be 1 month after the last contribution day.
(in case the maturity date lands on a holiday or weekend, the maturity day will be the next immediate business day)
Deposit Insurance
CDIC Eligible (CAD only)

No interest income will be paid for accounts terminated within 30 days of opening the account.




Contribution Limits

No earnings are required
$5,000(2009-2012), $5,500(2013)

Contribution limits are based on prior year’s earnings

Tax deductible

T5 is not issued

Tax deductible
Tax deferral benefits for deposits upon contributing to the account and earning interest income

Partial withdrawal

Not taxable

Treated as income, and is taxed at the applicable income tax rate

RRSP (Registered Retirement Savings Plan)

  • RRSP is a retirement savings plan that delays taxes on the amounts you contribute until you retire or terminate the account.
  • RRSP offers both tax-deferring and tax-sheltering services to individuals
  • RRSPs can be customized according to the amount of funds on hand and your personal post-retirement financial plan
  • Who Can Open a RRSP Account:

A person who works, files a Canadian Income tax return may contribute to your RRSP until December 31 of the year in which you turn age 71. There are maximum annual RRSP contribution limits. Your are allow to contribute for the currently year is:

The remaining limit after any company sponsored pension plan contribution

18% of your earned income from previous year, or

The maximum annual contribution limit for the taxation year




Contribution Limit







  • Deadline : To be eligible for an RRSP deduction in an taxation year, you can make contributions anytime during the year, or up to 60days into the following year
    Example: March 3, 2014
    (* Last day to get income tax deductions for year of 2013)

Features & Benefits

Prepare for retirement and get immediate tax benefits at a time. Your annual RRSP contribution can be deducted from your gross income at tax time, reducing the amount you pay in income tax that year.

Taxes on the income earned in your RRSP account are not taxed until it is withdrawn. It is deferred until you decide to withdraw or turn 71 years old.

After 71 years of age, the account holder may switch into RRIF in order to continue to receive tax deferred.

RRSP Loan is available to help your need as well

Spousal RRSP

Available for both married spouses and common-law partners

Still bound under the RRSP limit of the spouse

You still get the tax deduction, but the plan is registered in your spouse’s name. Your contributions to spousal plan do not affect your spouse’s contribution limit to his/her own plan it affects contributor’s Contributor’s contribution limit

Any withdrawals from a Spousal RRSP before the spouse turns 71 years of age will become a part of taxable income for that year

More beneficial if there is a large difference in income between spouses

RRSP Transfer and Rollovers

The owner of the RRSP may switch RRSP service providing institutions without incurring additional taxable income using the T2033 form. The RRSP can be transferred as either cash or financial product

Neither transferor nor transferee do not need to publish T4 slip

When depositing/withdrawing from the RRSP, the existence of a Locked-in Requirement must be checked, and the receiving party must notify the depositor of such requirement

A Locked-in Requirement Account (LIRA) is a conditional RRSP with a Locked-in

Transfer of retirement package into RRSPs

Retirement package is an employee compensation package received upon their retirement.

This can be converted to a RRSP to defer tax payments until the person becomes 71 years of age

The amounts that can be converted from a compensation package to a RRSP depend on the employee’s duration of employment

  • If the employee started working before 1989, the limit is $3,000 per year of employment if there is no RPP or DPSP. If there is a RRP or DPSP, the limit is $2,000 per year
  • If the employee started working after 1988 and before 1995, $2,000 per year
  • Transfer options do not exist for employees who started working after 1995

RRSP Term Deposit

1, 1.5, 2,3,4,5 year (option to select daily basis)
1 year, 1.5 year, 2 year, 3 year… (Select on yearly basis)
Partial Withdrawal
Cannot be terminated before maturity
1) No interest will be paid unless it is a month (30 days) old or over
2) If terminated after 30 days, the Savings Account interest rate of the day will be applied.
Maturity Options
Can be renewed automatically or transferred to a RRSP Savings Account at maturity
Deposit Insurance
CDIC provides deposit insurance for deposits of up to CAD 100,000 (sum of both interest and principal).  Please visit for more details.

The Home Buyer’s Plan RRSPs

  • HBP (The Home Buyers Plan) helps first time home buyers to withdraw funds penalty-free from their RRSP/Spousal RRSP to purchase a house
  • Can withdraw up to $25,000 from each spouse’s RRSP account
  • The withdrawn RRSP funds do not become taxable income and do not become withheld
  • Withdrawal limit of up to $25,000 is also applicable for home buyers who are not first-time buyers but have not owned a house during the past 5 years
  • The withdrawn amount from the RRSP must be re-deposited through equal annual payments over 15 years after the withdrawal, starting from the year after the withdrawal
  • Customers can exceed the required re-deposit amount at any time during the year
  • If some of the withdrawn money is left over and is returned within the year of the withdrawal, adjustments can be made to the annual re-deposit requirements
  • If the re-deposit requirement have not been met, the unreturned amount shall become taxable
Conditions for Withdrawal
  • Withdrawn RRSP amount under this plan must be used within 1 year to purchase Primary Residency or to fund its construction
  • The residency must exist within Canada, and the purchase must be completed before October of the following year after the purchase
  • The RRSP account from which the amount is withdrawn must have been existing at least 90 days before the withdrawal
Pros and Cons
  • The withdrawn amount from RRSP is ultimately tax-free
  • Able to increase the down payment amount for your mortgage, making houses more affordable
  • However, withdrawal forfeits the amount that can earn compound interest in the future

The Lifelong Learning Plan

The Lifelong Learning Plan reflects the government’s intent to encourage education for the taxpayer or his/her partner. It was established on Feb. 27, 1998, and allows taxpayers to make withdrawals from a RRSP for tuition expenses without incurring any tax penalties.
  • The education program must be at least 3 months long
  • If the student is a resident of Canada and has any disabilities, the student may make withdrawals even if he/she is not a full-time student
  • Total withdrawals from a RRSP cannot exceed $10,000 per year, but the total tuition can be withdrawn from multiple RRSP accounts.
  • Total withdrawals from a RRSP cannot exceed $20,000 over 4 years
  • The withdrawn amount must be re-deposited through equal annual payments over the next 10 years
  • The RRSP account from which the amount is withdrawn must have been opened for at least 90 days before the withdrawal
  • The re-deposit process must begin either within 60 days after the final year of the educational program, or within 60 days after 5 years from the first withdrawal
  • Usage of the Lifelong Learning Plan is unlimited but re-deposit obligations from previous usage of the Lifelong Learning Plan must be paid before new withdrawals can be made

RRIF ( Registered Retirement Income Fund)

Product Specifications

What is an RRIF?


A RRIF is a tax-sheltered vehicle that is a continuation of your RRSPs.


You have the option to convert a RRSP into an RRIF anytime before the end of the year of your 71st birthday.  If your RRSP is not converted to a RRIF before the end of the year you turn 71, your entire RRSP amount will be fully taxable as ordinary income.

You will not be able to make any contributions once you convert your RRSP to an RRIF.  RRIFs were created to extend the benefits of tax-deferred savings of a RRSP during your retirement.  A predetermined minimum amount must be withdrawn from a RRIF every year except for the year the RRSP was converted to a RRIF.  If you withdraw more than the predetermined amount, you can receive an exemption on withholding taxes.

Minimum RRIF withdrawal

In the year you turn 72, the minimum RRIF withdrawal is 7.38% of the principal of the plan.  Withdrawals from the RRIF must be made on the 1st of January each year.


The withdrawal percentage increases each year up to 20% until the holder reaches 94 and greater than 20% starting 95.


When funds transferred from spousal RRSP is cashed out greater than minimum RRIF withdrawal limit, the portion that exceeds the limit is considered as spouse’s income for 3 prior years.


RRIF Term Deposit

1, 1.5, 2,3,4,5 year ( option to select daily basis)
No restrictions
Partial Withdrawal
Interest Payment
Paid simple interest at maturity based on number of days from deposit to maturity at posted daily interest rate. If no such interest rate has been established, use the interest rate of a Regular Savings Account on amount withdrawn in excess of the minimum limit
Maturity Options
Can be re-deposited or transferred to a RRIF Savings account at maturity
Deposit Insurance
CDIC provides deposit insurance for deposits of up to CAD 100,000 (sum of both interest and principal).  Please visit for more details