There’s one well-known exception to this rule: With registered retirement financial savings plans (RRSPs), Canadians have 60 days after the tip of the calendar 12 months to make a contribution for the earlier tax 12 months. This implies you will have till midnight, 11:59 PM ET, on February 29, 2024, to make an RRSP contribution and decrease your taxable revenue for the 2023 tax 12 months.
What’s an RRSP?
An RRSP is a registered financial savings account designed to assist Canadians save for retirement. You possibly can maintain money and a variety of investments (together with shares, bonds, exchange-traded funds and assured funding certificates) in your RRSP, and contributions are tax-deductible, which means they cut back your taxable revenue.
Investments inside an RRSP develop tax-sheltered till they’re withdrawn, at which level the funds are added to your revenue and taxed at your marginal tax charge. Sometimes, the aim is to withdraw after you retire, when it’s possible you’ll be in a decrease tax bracket than once you have been incomes cash.
What’s the RRSP deadline for 2023?
Canadians have 60 days after the tip of the calendar 12 months to make RRSP contributions in direction of the earlier tax 12 months. This implies the RRSP deadline for the 2023 tax 12 months is midnight, 11:59 PM ET, on February 29, 2024.
Canadians who flip 71 have till December 31 of the identical 12 months to contribute to their RRSP. So, in the event you turned 71 in 2023, you had till December 31, 2023, to contribute to your account. Seventy-one can be the age at which you have to both money out your RRSP, convert it to a registered retirement revenue fund (RRIF) or buy an annuity.
How do RRSP deductions work?
RRSP contributions made between March 1, 2023, and Dec. 31, 2023, will be deducted out of your taxable revenue for the 2023 tax 12 months.
If you happen to contribute to an RRSP between January 1 and March 1, 2024, you will have two choices: You possibly can deduct these contributions out of your taxable revenue for both the 2023 or 2024 tax 12 months. Both approach, you’ll have to report the contributions in your 2023 tax return, however you’ll be able to select to hold the deductions ahead into the longer term.
Any contributions you make after this 12 months’s RRSP deadline on February 29 can be reported in your 2024 tax return.
When will my RRSP tax slips be obtainable?
Monetary establishments usually ship out tax paperwork earlier than the tip of January. These tax slips embody RRSP contributions made between January 1 and December 31 of the earlier 12 months.