Committed to providing solutions for your future needs.

Book a meeting
(877) 422-6346 x 552
CANFIN
Steven Miller
Steven Miller
Financial Advisor

Show all articles

Posts

Personal Wealth and Finance


It’s RRSP Top Up Time

February 1, 2018

It is that time of year when you weigh your tax bill against the contributions to an RRSP which can be deducted from your taxable income. This allows you to pay less tax on the money you make, hence leaving more money to invest for retirement.

Contributions to your RRSP provides a reduction of the tax due on that amount of your contribution. Many people use the tax saved to make an RRSP contribution for next year or pay off after-tax debt such as credit cards.

Talk to your advisor about discovering the maximum to contribute, providing the most tax return benefit.

RRSP Investments Grow Tax-Deferred. While your RRSP investments accumulate within the plan, you do not have to pay any tax on this growth. Any additions to your contributions, including capital gains, interest, dividends, and any other growth via dividends or distributions paid out on an investment fund, are also sheltered from taxation. The longer your money stays sheltered from the taxman, the greater the tax-free accumulative earning power of your investment. However, taxation occurs when income is withdrawn from your RRSP.

The true value of an RRSP is the deferral of taxation, and thus the increased compound growth your investments earn!

Know your Contribution Limit. To find out your RRSP contribution limit check last year’s Deduction Limit Statement on your latest Notice of Assessment or Notice of Reassessment.

Canada Revenue Agency (CRA) establishes guidelines for the minimum and maximum overall yearly amount a person is eligible to contribute to their RRSP as follows: 18% of earned income in the previous year, minus any Pension Adjustment = your eligible contribution amount. 1

You may have Carry-forward Contribution Room. If you have not previously invested up to your maximum RRSP contribution limit, CRA allows you to carry over unused contribution room into future years for an indefinite period. Check out your Notice of Assessment.

1 CRA Website

 

 

Publisher's Copyright & Legal Use Disclaimer

All articles are a legal copyright of Adviceon®Media.

The particulars contained herein were obtained from sources which we believe are reliable, but are not guaranteed by us and may be incomplete. This website is not deemed to be used as a solicitation in a jurisdiction where this representative is not registered. This content is not intended to provide specific personalized advice, including, without limitation, investment, insurance, financial, legal, accounting or tax advice; and any reference to facts and data provided are from various sources believed to be reliable, but we cannot guarantee they are complete or accurate; and it is intended primarily for Canadian residents only, and the information contained herein is subject to change without notice. References in this Web site to third party goods or services should not be regarded as an endorsement, offer or solicitation of these or any goods or services. Always consult an appropriate professional regarding your particular circumstances before making any financial decision.

Mutual Funds and/or Segregated Funds Disclaimer

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investment funds, including segregated fund investments. Please read the fund summary information folder prospectus before investing. Mutual Funds and/or Segregated Funds may not be guaranteed, their market value changes daily and past performance is not indicative of future results. The publisher does not guarantee the accuracy and will not be held liable in any way for any error, or omission, or any financial decision. Talk to your advisor before making any financial decision. A description of the key features of the applicable individual variable annuity contract or segregated fund is contained in the Information Folder. Any amount that is allocated to a segregated fund is invested at the risk of the contract holder and may increase or decrease in value. Product features are subject to change.