Each year I help over 500 clients file their Canadian and US tax returns as well as plan for both their Canadian and US investment accounts. I also regularly help new US clients plan for their move to Canada.
Canada will withhold 25% of the RRSP payment at source. Unfortunately the withholding rate is not reduced by the Canada-UK tax treaty. Only when the payment is a “periodic pension payment” (RRIF or annuity) will the withholding rate be reduced to 0%.
If the $10,000 is more than 90% of your total worldwide income you could file a s.217 Canadian tax return to try and recover some of the 25% withholdings.
Hope that helps
Phil Hogan, CA