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posted Oct 30, 2019 12:42:00 AM

I contribute towards an RPP. Does this amount count towards my RRSP contribution limit? How can I be sure I am maximizing my savings without over-contributing?

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Level 5
Oct 30, 2019 12:42:02 AM

Your 2016 contributions to your Registered Pension Plan ("RPP") are deductible in the year they are contributed, 2016.  Your 2017 RRSP deduction limit is based on a calculation that included either the value of the RPP contributions made or the value of the retirement benefit earned in 2016, this is reported as a Pension Adjustment, "PA", box 52 on your T4. The PA will always reduce the following years RRSP Deduction Limit, i.e 2016 RRSP deduction limit was reduced by your 2015 PA amount, and grew by your 2015 Earned Income.  Your Notice of Assessment would report your RRSP Deduction Limit Statement for the year, giving you your deduction limit for the year, a calculation that includes the amount of room earned and the PA amount reducing it.

4 Replies
Level 5
Oct 30, 2019 12:42:02 AM

Your 2016 contributions to your Registered Pension Plan ("RPP") are deductible in the year they are contributed, 2016.  Your 2017 RRSP deduction limit is based on a calculation that included either the value of the RPP contributions made or the value of the retirement benefit earned in 2016, this is reported as a Pension Adjustment, "PA", box 52 on your T4. The PA will always reduce the following years RRSP Deduction Limit, i.e 2016 RRSP deduction limit was reduced by your 2015 PA amount, and grew by your 2015 Earned Income.  Your Notice of Assessment would report your RRSP Deduction Limit Statement for the year, giving you your deduction limit for the year, a calculation that includes the amount of room earned and the PA amount reducing it.

Level 6
Nov 25, 2019 2:27:12 PM

Hi, thank you for using Intuit turbotax Live Community

The Canada Revenue Agency( CRA) will tell you your RRSP deduction limit on the Notice of Assessment they send. For example, your 2018 notice of assessment will have your 2019 RRSP deduction limit. Your RRSP deduction limit is the amount of RRSP you will be allowed to deduct on your tax return. There may be  a pension adjustment related to your RPP  which would affect your RRSP deduction limit but CRA will adjust for this on your RRSP deduction limit published on the notice of assessment.

So always use the notice of assessment information for your RRSP deduction limit.

Hope this helps

Level 1
Feb 25, 2023 6:16:19 AM

2022 is the first year that I am contributing towards a RPP, amount deducted at source from paycheck.  Does that mean that the Pension amount on box 52 will only reduce the 2022 RRSP contribution limit and not affect the 2021 NOA RRSP limit, correct?

 

Let's say I had a room of 100k on my 2021 NOA RRSP limit, I contributed say 80k towards my RRSP between March 15, 2022 and Dec. 31, 2022. The RPP amount on my T4 say is 10k,  while the Pension Adjustment on Box 52 is 20k, does that mean I still have 10k room left to contribute (100k-80k-10k) before the March 1st deadline? Can someone confirm if my math is correct before I contribute the additional 10k?

Moderator
Mar 2, 2023 10:22:07 AM

As per the CRA: Existing registered pension plans are, in some cases, eligible for transfer into your RRSP, and qualifying transfers do not affect your RRSP deduction limit as long as they are transferred directly between RPP and RRSP.  RRPs and deferred profit-sharing plans affect your RRSP contribution limit in the same way.

As both types of programs are pensionable benefits earned through an employment arrangement, your annual T4 information slip from your employer includes a pension adjustment (PA) amount. This is required under the registration rules for the pension or profit-sharing plan.

 

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