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melosz1
New Member

How to declare RRSP withdrawal which was not declared in previous tax years?

Hello, it's my first RRSP tax year and I did some mistake - I contributed 4000$ in December 2018 and additional 4000$ in January 2019 which is overcontribution in my case - I withdrew 4000$ in February 2019 but tax was witheld by the bank. How do I deal with that to get tax back and not loose my contribution room? Should I declare it as 8000$ contribution for 2018 and withdrawal on T4RSP from? Will it have any consequences?How do I do that using tax software?

3 Replies
TurboTaxEsther
New Member

How to declare RRSP withdrawal which was not declared in previous tax years?

Since the withdrawal was in 2019, you will receive a T4RSP for 2019. Do not claim the RRSP withdrawal on your 2018 return.

You will claim $8000 in RRSP contributions and carry forward the $4000. 

The tax withheld will be recuperated in 2019. 

This is from CRA:

"Withdrawal made without Form T3012A. If you withdraw unused RRSP, PRPP or SPP contributions without Form T3012A, the issuer of the plan has to withhold tax. The amount you withdraw from your RRSP should be reported on line 129 of your income tax and benefit return if it appears in box 22 of the T4RSP slip. If the amount appears in box 16 and box 24 of the T4RIF slip and you are 65 years or older at the end of December 2018, report the amount from box 16on line 115. Otherwise, report that amount on line 130. The amount you withdraw from your PRPP will appear in box 194 of the T4A slip and the amount you withdraw from your SPP will appear in box 16 of the T4A slip. Report those amounts on line 130.

In all cases, claim the tax the issuer withheld on line 437 of your income tax and benefit return.

Fill out Form T746, Calculating Your Deduction for Refund of Unused RRSP, PRPP, and SPP Contributions, to calculate the amount you can deduct for the withdrawal. For more information about claiming the deduction for the withdrawal of unused RRSP contributions, see line 232 in the Income Tax and Benefit Guide."

melosz1
New Member

How to declare RRSP withdrawal which was not declared in previous tax years?

But it will be overcontribution if I declare 8000$ for 2018 (I have 4000$ room for 2018 only). Won't it be better to declare 8000$ for 2018 and use another form for withdrawal during the same tax year? (all contributions were made before March 1st 2019 so I can declare them for 2018)
TurboTaxEsther
New Member

How to declare RRSP withdrawal which was not declared in previous tax years?

But the withdrawal was in 2019 which will mess it up. You MUST report $8000 contributions in 2018 and carry forward the $4000. Yes, it will be an over-contribution but not for very long since you took it out when you noticed it. You will likely not have any penalties for the mistake.
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