Investment Solutions

Detailed information on discount brokerage accounts and investment solutions available for investing success

Registered accounts

Whether you are planning for retirement or your children's education, National Bank Direct Brokerage offers numerous registered accounts that allow you to accumulate investment income tax free

Registered accounts provide greater tax efficiency since the investments you hold in them are not subject to tax regulations. However, in order for a buy order to be accepted, there must be sufficient funds in the account to cover the transaction in full. The funds can be held as cash or in a liquidity product (money market fund, high-interest account, Treasury bills).

Furthermore, according to federal regulations, securities traded on the US over-the-counter (OTC) market (pink sheets) are not eligible in registered accounts.

Some registered accounts can now hold US dollars:

  • Tax-Free Savings Accounts (TFSAs)
  • Registered Retirement Savings Plans (RRSPs)
  • Locked-In Retirement Accounts (LIRAs)
  • Locked-In RRSP Accounts

This allows you to avoid conversion rates on your US trades.

Browse the sections below to learn more on registered accounts.      

Tax-Free Savings Account (TFSA)

The TFSA is a savings instrument in which your money grows sheltered from taxes. You can deposit up to CDN $5,500, starting in 2016 per year per person, regardless of your incomelevel, all the while having the right to contribute unused amounts from previous years, since 2009. Note that from 2009 to 2012, the maximum annual contribution was CDN $5,000. The contribution room was increased to CDN $5,500 per year in 2013, to $10,000 in 2015 and back to $5,500 in 2016.

While your contributions are not tax-deductible under the personal income tax law, the income generated from your investment (interest, dividends and other) and capital gains are not taxable, even when withdrawn.

As its name indicates, the tax-free savings account is a savings tool. Depending on your needs, it can be used for your retirement, for short and long-term projects, such as buying a car, renovating a home or taking a sabbatical, or simply as an emergency fund. You can withdraw from it at any time and for any reason, and the amount withdrawn will be added to your contribution room of the calendar year following the year of the withdrawal.

You can contribute regularly by taking advantage of a periodic investment strategy or by transferring funds via our website.

Account available in Canadian or US dollars.

Read more about the TFSAOpen an account now

Registered Retirement Savings Plan (RRSP)

RRSPs allow you to save funds sheltered from taxes, in preparation for your retirement, all the while reducing your personal income tax levels.

Contributions to an RRSP can be deducted from your annual income for the year during which the contributions were made. Deposited amounts are subject to the tax rate in effect at the time of the withdrawal, i.e. at retirement.

You can contribute regularly by taking advantage of a periodic investment strategy or by transferring funds via our website.

Account available in Canadian or US dollars.

Read more about the RRSPOpen an account now

Locked-In Retirement Account (LIRA)

The LIRA is a retirement savings instrument in which you can transfer the value of your lock-in rights accumulated in a registered pension plan (RPP) or life income fund (LIF) of provincial jurisdiction.

You can open a LIRA up to December 31 of the year in which you turn 71. Anyone who leaves employment after two years of participation in a pension plan can transfer their contributions to a LIRA.

The LIRA must be converted into a LIF or life annuity no later than December 31 of the year you turn 71.

Note that it is not possible to withdraw from a LIRA before it is converted to a life annuity disbursement vehicle.

Account available in Canadian or US dollars.

Open an account now

Locked-In RRSP Account

The locked-in RRSP account is a retirement savings instrument in which you can transfer funds accumulated in a pension plan or LIF of federal jurisdiction.

You can open a locked-in RRSP account up to December 31 of the year in which you turn 71. It must then be converted into a federally chartered life annuity or LIF no later than December 31 of the year you turn 71.

Anyone who leaves employment after two years of participation in a pension plan can transfer his/her contributions to a locked-in RRSP account.

Note that it is not possible to withdraw from a locked-in RRSP account.

Account available in Canadian or US dollars.

Open an account now

Registered Education Savings Plan (RESP)

The rising cost of education makes it increasingly imperative to save for your children’s post-secondary studies.

If you wish to invest in your children’s future, it is in your interest to sign up for a registered education savings plan (RESP). These accounts are designed to help you finance their postsecondary education by giving you the opportunity to grow your savings sheltered from taxes.

The self-managed RESP also allows you to take advantage, granted you meet the eligibility criteria, of the Canada Education Savings Grant (CESG), the Canada Learning Bond (CLB) and other tax benefits. Furthermore, depending on your province of residence, you could be entitled to other grants.

Learn more about the RESP │ Open an account now

Registered Disability Savings Plan (RDSP)

A Registered Disability Savings Plan (RDSP) is a savings plan that helps Canadians with disabilities and their families achieve greater financial security and peace of mind for the future.

If you want to save for future financial needs such as medical and living expenses, consider opening an RDSP today.

In addition to providing tax-deferred growth, an RDSP also gives eligible individuals access to Canada Disability Savings Grants and Canada Disability Savings Bonds.

Find out more about the RDSP

Registered Retirement Income Fund (RRIF)

Like every other investor, you will need to convert your registered accounts (RRSP, LIRA and locked-in retirement RRSP) at the latest the year you turn 71.

National Bank Direct Brokerage gives you a great deal of flexibility when it comes to the types of investments you keep in your retirement income accounts. The main difference is that you are required to withdraw a minimum amount each year (except for the first year where no minimum is calculated). This minimum is determined by your financial institution depending on the market value of your account at the market closing on December 31. Click here for details on how minimum withdrawals are calculated.

Note that no taxes are deducted at the source on your minimum withdrawal. If you wish to withdraw an additional amount, taxes will be held as per the following table:

 

Since January 1, 2005 Quebec
Canada (except Quebec) 
  Provincial
Federal
Federal 
$5,000 and under 16%  5% 10%
$5,000.01 to $15,000
16% 10%  20% 
$15,000.01 and over  16% 15% 30% 

There are two main types of retirement income accounts:

The Registered retirement income fund (RRIF) is, in a way, a natural continuation of the RRSP. In addition to allowing you to keep deferring taxes on your principal and interest until funds are withdrawn, it also lets you make monthly, quarterly, semi-annual or annual withdrawals of retirement income. It is up to you to choose the amount you want to withdraw, as long as you meet the government-required minimum payout.

You can reduce the annual payout by basing the calculations on the age of your spouse, as long as they are younger. It is however important to know that you must make that decision when opening your account; your choice is then irreversible.

With National Bank Direct Brokerage, there is no age limit to open an RRIF. Plus, you are entitled to make lump sum withdrawals, which are then taxed as income in the year of their withdrawal.

The RRIF also offers spousal protection under which the amounts invested in the plan are rolled over to the surviving spouse's RRSP or RRIF at the subscriber's death.

The Life Income Fund (LIF) account is a retirement income plan similar to RRIFs, with the exception that it also sets an annual maximum for withdrawals. However, it may be possible to withdraw more than the annual maximum allowed, depending on your LIF’s jurisdiction.

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