Why do my RRSP contributions and Donations all reduce my tax return?

[pmcnaug]

Everytime I enter an RRSP contribution and a donation my tax return gets lower and lower. I have no used by RRSP contribution room up.

[Zack1103]

RRSP contributions and donations can both reduce your taxable income, which in turn can lower your tax return.

RRSP contributions are tax-deductible, meaning that the amount you contribute to your RRSP can be deducted from your taxable income, reducing the amount of income on which you have to pay tax. For example, if your taxable income is $50,000 and you make an RRSP contribution of $5,000, your taxable income would be reduced to $45,000, resulting in lower taxes owed.

Donations made to registered charities and other qualified donees can also be claimed as a tax credit on your income tax return. The credit amount depends on the value of the donation and the tax bracket you are in. The tax credit is applied to reduce the amount of tax you owe, effectively lowering your tax return.

It's worth noting that there are limits on how much you can contribute to your RRSP and how much you can claim as a tax credit for donations. The Canada Revenue Agency sets annual limits on these amounts, and it's important to ensure that you don't exceed them. please click   two the links provided to you

   How is your RRSP deduction limit determined

  RRSPs and Your Tax Return

Thank you for choosing TurboTax! 

[Zack1103]

RRSP contributions and donations can both reduce your taxable income, which in turn can lower your tax return.

[Zack1103]

RRSP contributions are tax-deductible, meaning that the amount you contribute to your RRSP can be deducted from your taxable income, reducing the amount of income on which you have to pay tax. For example, if your taxable income is $50,000 and you make an RRSP contribution of $5,000, your taxable income would be reduced to $45,000, resulting in lower taxes owed.

Donations made to registered charities and other qualified donees can also be claimed as a tax credit on your income tax return. The credit amount depends on the value of the donation and the tax bracket you are in. The tax credit is applied to reduce the amount of tax you owe, effectively lowering your tax return.

It's worth noting that there are limits on how much you can contribute to your RRSP and how much you can claim as a tax credit for donations. The Canada Revenue Agency sets annual limits on these amounts, and it's important to ensure that you don't exceed them. please click   two the links provided to you

   How is your RRSP deduction limit determined

  RRSPs and Your Tax Return

Thank you for choosing TurboTax!