How to reduce withholding tax by your employer?

First, you can submit the form T1213 called Request to Reduce Tax Deductions at Source to CRA.

One common justification to reduce tax is RRSP contribution. Many people wait for the tax refund and feel very happy about it. However, the government hold the refund for a year and don’t pay you any interest. Instead, you can receive the extra money much earlier on every paycheck. Why wait?

CRA takes up to 8 weeks to approve it. Sometimes they send it to your CRA account and sometimes by mail. You can then send the approval to HR or payroll department. You have to submit it every year.  Ideally you do it around November so that you can get the reduction starting the first paycheck of the next year. Even if you do it mid year, you will still see the bigger paycheck right after you complete the above steps.

It is never too late to act.