Investment Vehicles

Covers the legal and operational structures Canadians use to hold investments — taxable accounts, registered accounts (RRSP, TFSA, RRIF, RESP, RDSP, FHSA), trusts, segregated funds, and the basic structure of mutual funds and ETFs as vehicles. Mostly definitional and predictable.

Rules tested:Income Tax ActNI 81-102NI 81-101

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Taxable vs registered

Taxable (non-registered) account: gains taxable in the year realized.
Registered accounts get tax-deferred or tax-free growth.
Foreign investment in a TFSA does not recover foreign withholding tax (FWT).
RRSP withdrawals are fully taxable as income.

RRSP and RRIF

RRSP contribution = 18% of prior-year earned income, up to the annual limit (verify current limit).
Spousal RRSP allows income splitting in retirement (3-year attribution rule).
HBP withdrawal: up to $60,000 from RRSP for first home (repaid over 15 years).
LLP: up to $20,000 for lifelong learning (repaid over 10 years).
RRSP must convert to RRIF or annuity by Dec 31 of the year you turn 71.
Minimum RRIF withdrawal % rises with age.

TFSA

TFSA contributions are after-tax. Growth and withdrawals are tax-free.
Annual contribution limit set each year by CRA (verify current).
Unused contribution room carries forward indefinitely.
Withdrawals create new contribution room equal to the withdrawal, available the following year.

RESP, RDSP, FHSA

RESP: lifetime contribution limit $50,000 per beneficiary. CESG = 20% match on first $2,500/year.
Additional CESG for lower-income families. CLB for low-income families.
RDSP: lifetime limit $200,000. CDSG and CDSB grants for disabled beneficiaries.
FHSA: $8,000 annual contribution, $40,000 lifetime, for first home purchase.

Mutual funds and ETFs as vehicles

Mutual fund = pooled vehicle issuing units, priced once daily at NAV.
ETF = exchange-traded, priced continuously, in-kind creation/redemption mechanism.
Segregated funds: insurance contracts with maturity/death benefit guarantees.
Fund Facts (NI 81-101) and ETF Facts (NI 41-101) are mandatory disclosure documents.

Trusts and other vehicles

Inter vivos vs testamentary trust: created in life vs at death.
Henson trust: protects ODSP/AISH disability benefits.
Family trust: income splitting (subject to TOSI restrictions since 2018).
Discretionary vs non-discretionary trusts: who decides distributions.

Exam traps

Trap:Treating TFSA withdrawal room as immediately re-usable.Fix:Withdrawals create new room in the FOLLOWING calendar year, not the same year.
Trap:Assuming foreign withholding tax is recoverable in any registered account.Fix:FWT recoverable in RRSP/RRIF (US-CAN treaty) but NOT in TFSA.
Trap:Missing the Dec 31 of the year you turn 71 RRSP-to-RRIF conversion deadline.Fix:RRSP must convert or annuitize by Dec 31 of the year you turn 71. Penalty if missed.

Memory hooks — Element 6

Ciroexam · CIRE 2026

→RRSP = 18% earned income, max age 71
→TFSA = after-tax in, tax-free out
→HBP = $60K, repay over 15 years
→LLP = $20K, repay over 10 years
→FHSA = $8K/year, $40K lifetime
→CESG = 20% on first $2,500 RESP
→ETF Facts = NI 41-101 Part 3B