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New Member
posted Apr 21, 2022 1:39:17 PM

I rec'd a severance package from work, it was deposited to my RSP from my employer. I rec'd a cont. slip but no income slip. Is this correct?

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1 Replies
Level 4
Apr 23, 2022 9:53:55 AM

According to the Canada Revenue Agency (CRA), this is indeed correct, you should not receive the severance pay as taxable income and therefore will not reflect on your T4 slip. The reasoning behind this is that you have deposited it into the RRSP and if you do decide to withdraw the money, it will have to be reported as taxable (Because all RRSP withdrawals are considered taxable income before retirement). However, you must report that you put the severance pay to your RRSP as a contribution.

For more information, check out: Canada Revenue Agency - Understanding your severance pay

 

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