RRSP Rules

Tax-Tip-RRSP-ContributionRRSP Rules

1. You can contribute to your RRSPs until the end of the year you turn 71 as long as you have earned income. After 71 you have 3 options:

  • Take the cash and pay taxes
  • Buy a life annuity (Money goes to life insurance)
  • Move RRSP to Registered Retired Income Fund (RRIF) but you have a minimum annual withdraw and this money is taxable

Best to choose: Tax Free Savings Account (TFSA)

Yet, negative for older Canadian taxpayers

2. You can contribute up to 18% of previous year’s earned income

3. Pay attention to your carry-forward

4. You may deduct the full amount of your RRSP from your income

5. You can invest your RRSP money

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