RRSP over contribution
Just found out over contributed around 6000 lol. I purchased in February. Could I simply withdraw 6000? Do I need fill in any form and send to CRA?
Thanks
Thanks
Apr 1st, 2021 8:11 pm
Apr 1st, 2021 8:31 pm
Apr 1st, 2021 8:32 pm
Apr 1st, 2021 8:34 pm
Didn't cra charge 1% each month on over contribution? Also I thought the room is against 2020?
Apr 1st, 2021 8:35 pm
Apr 1st, 2021 8:37 pm
Apr 1st, 2021 8:42 pm
Apr 1st, 2021 8:43 pm
Apr 1st, 2021 8:59 pm
The deduction is just deferred until the 2021 tax return. Report it on the 2020 tax return (first 60 days of 2021 line) as a contribution but don't claim the deduction in 2020. If you have no room in 2020 the deduction wouldn't be allowed anyways. The deduction is carried forward.
Apr 1st, 2021 9:02 pm
Ok thanks. It seems to me that only apply for 2000 over contribution?DaveTheDude wrote: ↑ The deduction is just deferred until the 2021 tax return. Report it on the 2020 tax return (first 60 days of 2021 line) as a contribution but don't claim the deduction in 2020. If you have no room in 2020 the deduction wouldn't be allowed anyways. The deduction is carried forward.
Apr 1st, 2021 9:06 pm
Claim as much of the $6000 for 2020 as you can (plus $2000). Use the remainder for 2021. (You must report all contributions as per slips received, but you only need to claim the amount that will not put you into overcontribution.)
Apr 1st, 2021 9:08 pm
Thanks. Feel better
Apr 1st, 2021 9:20 pm
No form is required because you will not have over contributed. Assuming you will have $4K of new RRSP contribution room available in 2021. Your tax software should reveal that on doing the 2020 tax return.
Apr 1st, 2021 9:29 pm
Thanks!DaveTheDude wrote: ↑ No form is required because you will not have over contributed. Assuming you will have $4K of new RRSP contribution room available in 2021. Your tax software should reveal that on doing the 2020 tax return.
Apr 2nd, 2021 3:37 pm
Money Smarts Blog wrote: ↑I agree with the previous posters, especially Thalo. {And} Thalo's advice is spot on.
Apr 2nd, 2021 10:07 pm
Thanks for taking your time to answer itThalo wrote: ↑ What's really going to happen is that you'll get your 2020 notice of assessment (online) after filing your taxes and it will probably say something like:
New RRSP contribution room earned based on 2020 income: $10,000 (A)
Unused RRSP contribution from a prior year: $6000 (B)
If B is higher than A you may have over-contributed.
I didn't check exactly what it says, but something along those lines. So basically if you earned $10K of contribution room for 2021 based on your 2020 income, and your over-contribution was $6000 then they balance out.
Had you made the over-contribution in December, you'd likely owe 1% x $4000 (the excess minus $2000). Twice that if it was done in November... etc.
Apr 4th, 2021 6:32 am
Apr 4th, 2021 8:14 am
Yes, as long as where you work, you don't have a company pension plan since this (pension adjustment) amount will reduce your RRSP contribution limit.
Apr 4th, 2021 8:29 am
Apr 4th, 2021 5:58 pm
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