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RRSP Employer Match Contributions Tax Question

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  • Feb 4th, 2012 12:44 am
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[OP]
Member
Aug 13, 2004
288 posts

RRSP Employer Match Contributions Tax Question

Just had a quick question.

I have a company RRSP, as well my company also matches my RRSP contributions to a certain percentage.

When im calculating my RRSP contribution room, do i need to take into consideration my employer match as well?

For example if my company matched 9% and i contributed 9% to a personal RRSP, would i then effectively have used 18% RRSP contribution space?

Thanks!
21 replies
Sr. Member
Dec 9, 2007
537 posts
13 upvotes
It depends! That being said in the end it has the same impact on your RRSp contribution room.

The 2 scenarios I have experienced in my career are:

- Your contribution is RRSP and you get a tax receipt for your part. The company portion is in a DPSP account and the matching amount is captured as a pension adjustment on your T4 affecting next years contribution room.

- Both yours and theirs counts on your RRSP tax slip affecting current year RRSP room however you are being taxed somewhere along the way for the company portion.

Hope that helps.

Rob
[OP]
Member
Aug 13, 2004
288 posts
Hm, so with that being said then how do i figure out how much i can contribute in this year?
Jr. Member
Apr 25, 2008
148 posts
4 upvotes
rodneyc8063 wrote:
Jan 17th, 2009 6:33 am
Hm, so with that being said then how do i figure out how much i can contribute in this year?
wait till you do your tax return?
Member
May 23, 2006
239 posts
2 upvotes
rodneyc8063 wrote:
Jan 17th, 2009 6:33 am
Hm, so with that being said then how do i figure out how much i can contribute in this year?
It's 18% of your taxable income from last year, plus an unused carryover room from previous years.

Both RRSP contributions (doesn't matter who actually pays - even if the employer pays it's taxable income and is added onto your T4 at the end of the year) and pension/DPSP contributions (via the Pension Adjustment line, which is in general your contributions plus your employer contributions) count towards the limit.
Jr. Member
Nov 25, 2008
107 posts
8 upvotes
rodneyc8063 wrote:
Jan 17th, 2009 4:09 am
Just had a quick question.

I have a company RRSP, as well my company also matches my RRSP contributions to a certain percentage.

When im calculating my RRSP contribution room, do i need to take into consideration my employer match as well?

For example if my company matched 9% and i contributed 9% to a personal RRSP, would i then effectively have used 18% RRSP contribution space?

Thanks!
Yes, that is correct provided the total amount contributed by both you and your employer doesn't exceed your total RRSP contribution limit (as stated on your last Notice of Assessment). The maximum RRSP deduction limit for 2008 is $20,000. However, if you did not use all of your RRSP deduction limit for the years 1991-2008, you can carry forward the unused amount to 2009. Therefore, your RRSP deduction limit for 2008 may be more than $20,000. The maximum for 2009 is $21,000.
Deal Addict
Oct 12, 2005
1711 posts
188 upvotes
GTA
Mr CFP wrote:
Jan 17th, 2009 5:51 pm
Yes, that is correct provided the total amount contributed by both you and your employer doesn't exceed your total RRSP contribution limit (as stated on your last Notice of Assessment). The maximum RRSP deduction limit for 2008 is $20,000. However, if you did not use all of your RRSP deduction limit for the years 1991-2008, you can carry forward the unused amount to 2009. Therefore, your RRSP deduction limit for 2008 may be more than $20,000. The maximum for 2009 is $21,000.
But you cannot claim the employer's contribution in your tax return, correct? I can't remember as I had been on a pension plan for awhile now.
Deal Addict
Jul 28, 2005
3237 posts
18 upvotes
lg777 wrote:
Mar 2nd, 2009 12:50 am
But you cannot claim the employer's contribution in your tax return, correct?
No, you can and should. The employer's contribution counts as a taxable benefit. It also counts as a contribtion that you can deduct. So if you choose to deduct it in the same tax year as the contribution, then for tax purposes it's basically a wash.
Deal Addict
Oct 12, 2005
1711 posts
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asdfvcx wrote:
Mar 2nd, 2009 1:02 am
No, you can and should. The employer's contribution counts as a taxable benefit. It also counts as a contribtion that you can deduct. So if you choose to deduct it in the same tax year as the contribution, then for tax purposes it's basically a wash.
That's funny cause I only got a receipt for my contributions and not my employer's. I better call them and ask for it.
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Sep 19, 2004
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lg777 wrote:
Mar 2nd, 2009 3:28 am
That's funny cause I only got a receipt for my contributions and not my employer's. I better call them and ask for it.
I got my RRSP receipt from the company (GW)
and a Pension contribution box on my T4 from employer

so maybe wait for the T4?
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Deal Addict
User avatar
Apr 23, 2005
1447 posts
9 upvotes
Toronto
Usually one of two scenarios:

1. Employer portion is added to your income as taxable benefit. You get RRSP Contribution receipt for your portion and your employer.

2. You get RRSP contribution receipt for your portion only. The employer portion is not added to your income, but is shown on box 52 of your T4 which you put on line 206.

Either way, both your contribution and your employer contribution is counted against your RRSP contribution room. T4 box 52 / line 206 accounts for your employer's portion and CRA uses this amount to reduce your contribution limit. Note that line 206 is not included in the calculation of line 233 and does not affect your net income
[OP]
Member
Aug 13, 2004
288 posts
Hm

So heres another question

Now since the employer contributions will be counted against my RRSP contribution room, does this mean that i can also withdraw this money and use it towards my first time home buyers plan?

See, if i was looking to max out my first time home buyers and the employers contributions do not count towards my first time home buyers plan, then i should actually reduce the amount of employer match?

Thoughts?
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Jun 26, 2005
7266 posts
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rodneyc8063 wrote:
Mar 3rd, 2009 6:23 am
Hm

So heres another question

Now since the employer contributions will be counted against my RRSP contribution room, does this mean that i can also withdraw this money and use it towards my first time home buyers plan?

See, if i was looking to max out my first time home buyers and the employers contributions do not count towards my first time home buyers plan, then i should actually reduce the amount of employer match?

Thoughts?
Read your company contribution plan rules. Depends on when the company's contribution is considered yours.
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Apr 23, 2005
1447 posts
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rodneyc8063 wrote:
Mar 3rd, 2009 6:23 am
Now since the employer contributions will be counted against my RRSP contribution room, does this mean that i can also withdraw this money and use it towards my first time home buyers plan?
You probably would not be able to withdraw from it if it was locked-in. If it was locked-in, it is usually only the employers contribution that is locked in, you can still withdraw your own money. But like rfdrfd said, read the RRSP contribution rules.
rodneyc8063 wrote:
Mar 3rd, 2009 6:23 am
See, if i was looking to max out my first time home buyers and the employers contributions do not count towards my first time home buyers plan, then i should actually reduce the amount of employer match?
Why reduce it? Employer contribution is free money. Maybe not now, but later.
Deal Addict
Sep 20, 2006
1507 posts
52 upvotes
I have a specific question regarding what has been mentioned above. From reading above, it looks like the employer contributions will show up on my T4 as a taxable benefit, and i will receive a T4RSP for the full amount. HOWEVER, I only was eligble and joined the company match RRSP beginning January 1, 2009. So for my 4 paychecks (twice a month) in Jan + Feb, the amount of RRSP contributed I want to designate for my 2008 return. So would I be able to claim the total RRSP (employee+employer) even though it didn't show up on my 2008 T4??? I'm assuming I can because it will be added as a taxable benefit for my 2009 T4.
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