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Gold RRSP – Fast Guide

Our Gold RRSP Guide is Split Into Easy-to-Follow Sections:

A Gold RRSP can form an important element in any well diversified portfolio, as it should help hedge a retirement plan from any risks of market downturn or financial crisis.

Not only does gold in an RRSP protect wealth, RRSP‘s are one of the most tax-efficient routes to buying gold. It makes sense for anyone with an interest in metals or coins to take advantage of this.

This guide explains the easy process for holding gold in an RRSP.

 

“If you ask me the Canadian real estate bubble is going to end badly and going to end soon. When that day comes I’ll be glad my RRSP is diversified into physical gold”

A.Macaig, St. Andrews NB

 

free gold rrsp rollover kit


Gold RRSP Overview

gold-rrsp-planThe 2005 Federal Budget made gold and silver bullion eligible for holding in retirement accounts for the first time.

Following this change, the Gold RRSP (Registered Retirement Savings Plan) became one of the most popular vehicles for long-term ownership of investment precious metals thanks to it’s tax-efficient nature.

With a Gold RRSP you can buy physical gold and silver bullion bars or coins to take advantage of their ability to hedge or protect your portfolio – all while reducing your annual income tax. Yes – when you buy or transfer physical gold into an RRSP, you’ll receive a tax deduction for the amount transferred.

This front-loaded discount allows you to buy more gold than if you had invested with post-tax money – and so you can leverage gains made over the lifetime of the RRSP.

As would be expected with any deal this good there are a number of restrictions on the types of bullion you buy, the purity of the bullion, where you buy it and where you can store it.

It may even be that an RRSP isn’t the best vehicle for your needs…


Gold RRSP or Gold TFSA?

gold-rrsp-taxGold or silver held in RRSPs and TSFAs is treated in just the same way as any other assets – so the key difference between an RRSP and a gold TFSA (Tax-Free Savings Account) is the tax treatment of the account.

True, there’s a major difference between a Gold RRSP and a gold TFSA in that an RRSP account is for retirement purposes whereas a TFSA can be used to save for anything – but usually it’s the tax treatment that’s going to have the greatest sway on your decision.

The big benefit of the RRSP is that when you buy or transfer physical gold into your RRSP, you get a tax deduction for the amount transferred which reduces the tax you’ll pay that year – and any increases in the value of your metals are not taxable within the RRSP itself.

The downside is that these gains are taken into your taxable income the year they are withdrawn from the RRSP.

The benefits of a Gold TFSA?

For gold RRSPs you pay tax on the value of the gold or silver when you sell the metals, but with with TFSAs this sale is tax free – that is any gains you’ve earned from gold’s rising value are tax exempt during the time it was contained within your TFSA.

The TFSA’s drawback is that you’re not eligible for any deductions at the point when you buy the gold.

Eligible metals are the same for both accounts, so it’s down to a personal choice – a choice of paying tax at the front, or the end of the deal.


Gold RRSP Rules

gold-rrsp-rulesThe general rules governing your Gold RRSP are the same as for any RRSP, which means gold RRSPs are subject to yearly contribution limits. Finding the exact amount you can contribute to your RRSP for the current year, means checking your most recent Notice of Assessment received from Canada Revenue Agency.

If you’re looking to buy a lot of precious metals it makes sense to buy at least some of them through a tax-advantaged process and if you don’t already have an RRSP it’s a simple process to open one.

The rules relating specifically to Gold RRSPs concern the type and purity of gold or silver bullion added, where they are sourced from and where they can be held.

Canada Revenue Agency provides a list of qualified investments in the Income Tax Folio S3-F10-C1, Qualified Investments documentation, excerpted here:
 

Gold and Silver

1.51 Subject to certain conditions, investments in gold and silver bullion coins, bars and certificates are qualified investments. The CRA would anticipate that the registered plan trustee would exercise due diligence in using a custodial trustee for such bullion.

1.52 A legal tender gold or silver bullion coin produced by the Royal Canadian Mint with a minimum purity of 99.5% for gold and 99.9% for silver is a qualified investment. To ensure that the coin is not held for its collectible value, the fair market value of the coin may not exceed 110% of the fair market value of its gold or silver content. In addition, the coin must be purchased directly from the Mint or from a Canadian-resident corporation that is a bank, trust company, credit union, insurance company or registered securities dealer whose business activities are regulated by the Superintendent of Financial Institutions or a similar provincial authority (referred to in ¶1.53 and ¶1.54 as a specified corporation).

1.53 A gold or silver bullion bar, ingot or wafer produced by a metal refiner accredited by the London Bullion Market Association and with the same purity standards that apply for coins (described in ¶1.52) is a qualified investment if it bears a hallmark identifying the refiner, purity and weight. In addition, the bullion must be purchased directly from the refiner or from a specified corporation.

1.54 A gold or silver certificate issued by the Royal Canadian Mint or a specified corporation is a qualified investment if the bullion represented by the certificate satisfies the conditions described in ¶1.52 or ¶1.53. In addition, the certificate must be purchased directly from the issuer or from a specified corporation.

 
That interpretation is taken directly from the Income Tax Regulations, Paragraph 4900. Within this Paragraph 4900(1)(t) states that a legal tender gold or silver bullion coin will be a qualified investment if it:
 

i) has a minimum purity of 99.5% for gold and 99.9% for silver,
ii) was produced by the Royal Canadian Mint,
iii) has a fair market value that does not exceed 110% of the fair market value of its gold or silver content, and
iv) is acquired by the deferred plan trust either directly from the Royal Canadian Mint or from a corporation (hereafter referred to as a “specified corporation”).

 
Paragraph 4900(1)(u) states that a gold or silver bullion bar, ingot or wafer will be a qualified investment if it:
 

i) meets the same purity standards of 99.5% for gold and 99.9% for silver, as are noted above for coins,
ii) was produced by a metal refiner that is accredited by the London Bullion Market Association,
iii) bears the hallmark of the refiner that produced it and is stamped with its fineness and weight, and
iv) is acquired directly from the refiner or from a specified corporation.

 
Penalties for adding non-qualified precious metals can be severe. You could face a tax of 50% on the value of these investments:
 

1.72 If an RRSP, RRIF, TFSA or RDSP acquires a non-qualified investment or an existing investment becomes non-qualified, the annuitant or holder of the plan is subject to a tax equal to 50% of the fair market value of the property at the time it is acquired or becomes non-qualified. The tax is imposed under section 207.04 for RRSPs, RRIFs and TFSAs and under section 206.1 for RDSPs.

RRSP Approved Metals

compare-1oz-gold-bullionSo which precious metal investments are allowed in an RRSP? Given the threat of a 50% penalty it’s important to get this right!

Taken from the regulations, gold coins must be at least 99.5% pure, and silver coins must be at least 99.9% pure. Importantly only legal-tender coins produced by the Royal Canadian Mint are RRSP-eligible.

Numismatic (collectible) coins are not allowed which rules out any proofs, special or commemorative issue coins – even when they are produced by the Royal Canadian Mint, as these all sell at significantly more than 110% of their metal-weight value.

Regulations surrounding bar purity are the same as for coins, but the regulations give much more leeway when it comes to buying bullion bars. Unlike with coins, investors are not forced to buy Canadian and are able to choose from any LBMA (London Bullion Market Association) accredited refinery.

The following coins and bars are currently permitted:
 

Gold and Silver Coins in an RRSP

Only non-collectible bullion coins from the Royal Canadian Mint are eligible for a Gold RRSP, meaning only common bullion coins are permitted.
 

Coin Face
value
Au/Ag
(oz)
Wt
(oz)
Wt
(g)
Dia
(mm)
Thick
(mm)
Fine
1 oz.
Maple Leaf
C$ 50 1 .0000 (Au) 1 31.1030 30.00 2.80 999.9
1/2 oz.
Maple Leaf
C$ 20 05000 (Au) 05 15.5515 25.00 2.23 999.9
1/4 oz.
Maple Leaf
C$ 10 02500 (Au) 025 7.7758 20.00 1.70 999.9
1/10 oz.
Maple Leaf
C$ 5 01000 (Au) 01 3.1103 16.00 1.22 999.9
1/15 oz
Maple Leaf
C$ 2 00666 (Au) 00666 2.099 15.0 098 999.9
1/20 oz
Maple Leaf
C$ 1 00500 (Au) 00500 1.581 14.1 0.92 999.9
1 oz Silver
Maple Leaf
C$ 5 1.0000 (Ag) 1 31.1030 37.97 3.29 999.9

 

Gold and Silver Bars in an RRSP

Gold bars must be at least 99.5% pure, silver bars 99.9% – and they must be manufactured at an LBMA accredited / listed refinery.

The current LBMA refinery list is available here and the following are some of the best known LMBA bullion manufacturers with bullion bars suitable for in an RRSP, all sizes and purities listed:
 

ABC Refinery
Gold 999.9: 400oz, 1kg, 500g, 10oz, 250g, 5oz, 100g, 2oz, 1oz, 1/2oz
Silver: 999.5: 5kg, 1kg, 500g, 10oz
Heraeus
Gold 999.9: 1kg, 500g, 250g, 100g
Silver 999.9: 15kg, 5kg, 1kg, 500g, 250g, 100g, 1oz
Metalor
Gold 999.9: 1kg, 500g, 250g, 100g, 50g, 1oz, 20g, 5g
Silver 999.0: 1kg, 100g
PAMP SA
Gold 999.9: 1kg, 500g, 10oz, 250g, 5oz, 100g, 50g, 1oz, 1/2oz, 1/4oz, 5g, 2.5g, 1g, 0.3g
Silver 999.0: 1kg, 500g, 10oz, 250g, 5oz, 100g, 50g, 1oz, 20g, 10g, 5g, 2.5g
Republic Metals Corporation
Gold 999.9: 400oz, 100oz, 1kg, 10oz, 5oz, 100g, 50g, 1oz, 10g, 5g, 2.5g, 1g
Silver 999.0: 1000oz, 100oz, 1kg, 10oz, 5oz, 1oz
Royal Canadian Mint
Gold 999.9: 400oz, 1kg, 10oz, 5oz, 1oz
Silver 999.9: 100oz, 1kg, 10oz, 1oz
Umicore
Gold 999.9: 12.5kg, 1kg, 500g, 250g, 100g, 50g, 1oz, 20g, 10g, 5g, 2.5g, 1g
Silver 999.0: 15kg, 5kg, 1kg, 500g, 250g, 100g, 50g, 1oz, 20g, 10g
Valcambi
Gold 995+: 400oz, 1kg, 500g, 250g, 100g, 50g, 1oz, 20g, 10g, 5g, 2.5g, 1g
Silver 999.0: 5kg, 1kg, 500g, 100g, 50g, 1oz,

Gold RRSP Storage

To qualify for the tax benefits of an RRSP, not only should approved metals be bought from approved suppliers – the metals should be stored at an approved vaulting facility. Home storage or non-approved storage will trigger a tax penalty.

storage-of-gold-rrsp-assetsThere are currently 7 facilities approved by the Investment Industry Regulatory Organization of Canada (IIROC).

All RRSP providers and gold dealers who arrange gold RRSPs will arrange IIROC-approved vaulting for you as part of their services.

There will be vaulting costs and management fees associated with this service so ensure to ask if these are a fixed cost or are based on the value of your metals.

For a larger holding value-based fees can become a costly annual expense, so fixed charges may be a better option.


How to Add Gold to an RRSP or TFSA

A Gold RRSP or TFSA is really just a name given to a regular self-directed account. Dealers do tend to call them things like RRSP Registered Bullion Accounts, but in the eyes of the CRA there is no special “Gold RRSP”.

But that’s not to say all RRSP managers or RRSP providers have the inclination, capabilities or the established network to add precious metals in an RRSP or TFSA. For the smoothest operation and usually the best prices it makes sense to use an RRSP provider used to working with bullion.

Better yet use a Gold RRSP specialist.

A Gold RRSP specialist dealer can add metals quickly and at the lowest costs due to their established relationships with approved refineries and storage facilities – and the economies of scale which grant them lower premiums. Because they deal with metals investors day in day out they are always able to give sound advice on the best metals to buy and when to buy them.

If you don’t already have a suitable account, specialists excel in helping open one – transferring existing investments as required.

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Gold RRSP Companies

As the gold industry’s precious metals dealer directory, we list all the Gold RRSP and Gold TFSA companies in Canada.

Every Gold RRSP company we list is rated and reviewed by real customers. Visitors can display listings to show all gold RRSP/TFSA companies as rated from highest to lowest in a single click.

You are able to find specialist RRSP providers, search all local gold RRSP companies or national listings with ease.
 

Our top rated Gold RRSP companies in 2018 are:

bullion-dealer-year-2018-badgeRegal Assets are our current International Bullion Dealer of the Year and Silver Gold Bull have now won Canadian Bullion Dealer of the Year in 2016, 2017 and 2018.

Regal are specialists in Gold RRSPs and TFSAs and Silver Gold Bull one of Canada’s best known e-commerce gold dealers.

Cache and Sprott have been incredibly close close runners up every year and are well known for their outstanding service. We’d wholeheartedly recommend any of these four companies for your RRSP needs.

Alternatively, view all our Gold RRSP listings, for a choice of 10 specialists.

 

 

Gold RRSP FAQ

gold-rrsp-questionsGot Gold RRSP questions? If you’ve asked it, chances are we’ve answered it in our list of Frequently Asked Questions.

From questions about the buying process, to queries on when, how much and what metals you can add to your gold RRSP, it’s ALL available here.

Have gold RRSP questions we’ve not covered?

Ask our expert RRSP partners in a zero-obligation call on 1-888 981 7130.

Click on the Gold RRSP FAQ below to display answers:
 

What is a Gold RRSP?

Why would I want gold in my RRSP?

What types of gold can I add to an RRSP?

Can I add gold I already own?

Can I add other investment types to my gold RRSP?

Can't I just add gold to my current retirement plan?

Can I take possession of the gold in my RRSP?

Can I own more than one RRSP or retirement account?

Can I transfer or rollover an existing retirement plan?

Where is my gold kept and is it secure?

How much does a gold RRSP cost?

Is there a minimum amount I need to purchase?

Is there a maximum amount I can contribute?

What happens if I've contributed too much?

Is there a contribution deadline?

Can I withdraw gold from my RRSP in an emergency?

Can I take a loan from my gold RRSP?

Can I combine two or more retirement accounts?

Why is it important to choose the right dealer?

Why is it important to choose the right metals products?

Is there a best time to buy gold?

 
 

Looking to Add Gold to Your RRSP or TFSA?

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Material provided on the Bullion.Directory website is strictly for informational purposes only. It is not intended as investment advice and must not be relied upon as such. Precious metals carry risk and investors requiring advice should always consult a properly qualified advisor. Bullion.Directory, it’s staff or affiliates do not accept any liability for loss, damages, or loss of profit resulting from readers investment decisions.

Why Gold and Why Now?

Prior to the crash of 2008, a typical Canadian would be perfectly happy in adding stocks, bonds and certificates to their retirement account. The markets were buoyant and paper assets were performing strongly, growing that all important retirement nest egg.

Indeed, that same typical Canadian wouldn’t consider adding anything more unusual to their retirement account, than shares in a few blue-chip companies – and in most cases their account custodians wouldn’t have allowed them to anyway.

Sure there were wild-card investors who wanted to balance their retirement basket and they’d add property and other “real” assets such as gold and silver to a self-directed RRSP…

But they were in a tiny minority.

If you asked Joe Normal if he had gold in his RRSP he’d look at you like you were a crazy.

He had stocks, shares, mutual funds and certificates like everyone else.

Why would anyone want to self-direct their retirement fund anyway?

gold rrsp companies

 

sheep-investorsAfter all the banks and those professional investors we pay so handsomely were running everything nicely – and it’s always much easier to sit back and let someone else take control.

Why rock the boat? Paper assets were where it was at and everyone was an expert in a rising market.

That is, until the crash came.

market-crashOvernight, trillions of dollars were wiped off the financial markets and millions of Canadians saw over half the value in their retirement accounts vanish into thin air.

If they’d been planning on retiring in the next few years, their lifetime of hard work would have been vaporised by forces outside their control.
Indeed things got very hard for these ordinary men and women – for some it meant financial ruin and for many others it meant a difficult choice of having to work long past that planned retirement or burdening their children with additional financial liability.

The big-name experts were horrified. “Nobody saw this coming”.

Except this wasn’t strictly true.

There had been a handful of vocal commentators and financial advisors warning of an impending implosion. A similar group of “crazies” to those mad, bad and dangerous to know folks who’d been adding gold and silver to their RRSPs.

Which is funny, because those crazy experts were advising anyone who’d listen to get out of paper assets, get out of real estate – and to buy gold and silver.

So how did “the crazies” fare?

While the markets crashed and burned, Gold saw massive growth. A $33k gold RRSP taken out in 2005 would have been worth $145,155 by 2013, while a paper-backed account would have struggled to $42,570 as the markets began a slow recovery.

Bear in mind that thanks to inflation, by 2013 you’d have needed $43,432 to achieve the same spending power as the original $33k in 2005 – meaning the stock-market investment would have made an overall loss.

A loss, versus a significant profit with gold

Why? Because gold typically acts as hedge against market volatility.

The ultra-rich have been using gold to protect their wealth for generations, it’s just nobody told the little guy.

Well nobody except those much-derided contrarian analysts.
 
You see they’d been advising people to buy gold when they saw what the markets were doing, when they saw what are now acknowledged to be unsustainable levels of borrowing and watched dangerous bubbles spreading across multiple markets at the same time.

Those that listened, and those with financial advisors worth paying for, took the opportunity to buy precious metals while they were still priced low.

Indeed, gold had effectively been shunned by the regular investor, sitting unloved in the low $300s for years, making gold a true bargain-basement investment.
 
As the crisis broke institutional investors were first to run for “safe-haven” assets like gold, creating demand that caused gold prices to rise.

When the mainstream media picked up on this, people began to flock to this exciting, rising commodity – and it’s price rose more and more rapidly.

Gold became THE investment. Companies sprang up touting it’s sparkle to new investors and as the price rose to ever dizzying heights, fortunes were made overnight.

It was a literal gold rush – and those once-crazy owners of self-directed gold RRSPs? Those who were first in?

They did exceptionally well.
 

Any losses in the paper asset sections of their RRSP had been more than made up for by gold’s strong performance.

Gold did exactly what gold does best. It hedges risk and protects wealth.

 
But even gold can’t protect against greed and bad advice, which saw far too many retail investors clamber into the now fast-accellerating gold market, creating unsustainable conditions leading to a bubble forming – and an inevitable correction.

Those investors who’d been last to the party, those who saw others making fortunes and threw the whole farm into gold hoping to strike it rich – got hurt.

Early investors would still be in substantial profit, but the last in? They saw a loss causing them to curse gold and all it stands for.

And so gold began another period in the wilderness, unloved and once again mocked, with a price bumping along neither going up, nor down…

Which brings us to present day.

Paper assets are at an all-time high. National-debt is at an all-time high. House prices are at an all-time high.

Those unsustainable loans and leveraged trades that were blamed for the 2008 crisis? All time high.

Gold meanwhile is just sitting there, still out of favor, it’s price still relatively static – and if you consider that silver and gold are barely trading for what it costs to mine and refine them, you’d perhaps even see them as a bargain

You wouldn’t be alone.

 
 
Once again the ultra-wealthy, those contrarians and a number of big investment funds with an eye to the future are very quietly buying as much gold as they can.

Billions of dollars in gold are being bought every day. Mints and refineries across the world are working 24-7 to meet demand.

And somehow, all this time, despite growing warnings the masses are still jumping into stocks, still buying at record highs…

It doesn’t take a genius to see what’s about to happen. Or to see the wise and the wealthy positioning themselves for the inevitable.

Thankfully this time round there are a lot more “crazies” adding gold to their self-directed RRSPs.

Hopefully you’ll join them.

If not, don’t say we didn’t warn you.

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