My bonus was transferred directly into my RRSPs. I used this contribution as a deduction against my 2013 income. Now it looks like I owe tax money in 2014?

My 2014 taxable income consists of my bonus from 2013 (paid in early 2014) + income from 2014.  I took my bonus an transferred it directly into my RRSPs and claimed this against my 2013 income (as a result I received a refund in 2013). 

 

For 2014 my 2014 T4 states my income as my bonus from 2013+income from 2014 however my return is indicating that I owe taxes.  I am not sure I understand why I owe taxes when my bonus is sitting in RRSPs?   

Many thanks

Answer

Hi Asha Devi;

If you took out the RRSP in the 1st 60days of 2014, you have the option of applying the contributions to year 2013 or 2014.

You applied the contributions in 2013 to further reduce your net income. L236.  This resulted in the 2013 refund.

As stated the bonus income was added to your 2014 taxes. You owe money since the credit was taken in 2013, and the income was included in 2014.

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