What happens if I over contribute to my RRSP?

Allan Madan, CA
 May 14, 2013
Share
 0 Comments
Photo credit: kenteegardin via Foter.com / CC BY-SA
Photo credit: kenteegardin via Foter.com / CC BY-SA

You have excess RRSP contributions if the total of:

  • Your unused contributions from prior years,
  • Your current year contributions, and
  • $2000 is more than your RRSP deduction limit shown on your latest Notice of Assessment.

You have to pay a tax of 1% per month on your excess contributions for every month that the contributions remain in an RRSP or until your excess amount is reduced by new RRSP deduction room. You may want to reduce continuing penalties by withdrawing the amount of the excess beyond the permitted $2,000. RRSP withdrawals must be reported in your personal tax return in the year of withdrawal.

 

Disclaimer

The information provided on this page is intended to provide general information. The information does not take into account your personal situation and is not intended to be used without consultation from accounting and financial professionals. Allan Madan and Madan Chartered Accountant will not be held liable for any problems that arise from the usage of the information provided on this page.

ABOUT THE AUTHOR

ALLAN MADAN

CA.CPA.CGA

Allan Madan is a CPA, CA and the founder of Madan Chartered Accountant Professional Corporation. Allan provides valuable tax planning, accounting and income tax preparation services in the Greater Toronto Area.

Related Resources

More from my site

Business & Corporate Tax

My spouse joined me on a business trip and my employer paid for both of our travel costs. Is my spouse’s portion a taxable benefit to me?

How do I add or remove a director, or change information about existing directors?

I purchased a corporate bond during the year. The purchase price included accrued interest to the seller of the bond. Is there a way for me to avoid being taxed twice on accrued interest?

What tax deductions can Americans working for a Canadian company in Canada claim?

U.S. & Cross Border Tax

If I am a non-resident of the US, do I need a social security number to file taxes?

Do U.S. Citizens who received a W2 slip for work done in Canada need to file a U.S. tax return?

If I am sending Canadian employees to work in the United States, do I need to withhold social security taxes from their pay in both Canada and the USA?

I am a Canadian resident and have some funds in a U.S. 401K. What is the most tax efficient way of bringing these monies into Canada?

Personal Tax

Do I have to report my income from hobby sales?

How can I split my company’s business profits with my children?

On the Personal Income Tax Return, why does it ask me if I own a foreign property with a cost of more than $100,000 CDN during the year?

What is pension income splitting?

    Get In Touch

    Pin It on Pinterest

    Share This