2022 RRSP Contribution Deadline

The final day to contribute to your RRSP for the 2021 tax year is March 1st, 2022. After that date any contributions to your RRSP will count for the 2022 tax year.

How Much Can I Contribute?

Because of the way RRSP contribution limits are calculated, the limit is unique to everyone. Each year you open more RRSP contribution room based on your annual earned income. The amount of contribution room that you get is calculated as 18% of your earned income up to a certain maximum. For 2021 the maximum is $27,830. Your total contribution room is then calculated as the sum of the new amount that you have opened plus all unused room from the preceding year. You can find your unused contribution room on your Notice of Assessment from the government, but it will not consider any contributions you may have already made for the year. 

Benefits

The main benefit of contributing to your RRSP is the ability to reduce your taxable income for the year. In many cases a contribution to your RRSP can offer you a larger tax return or reduce the taxes that you must pay. However you choose to invest your money in your RRSP that money can grow tax deferred until you begin to take income from the account. You can also use your RRSP money towards the down payment on your first home through the Home Buyers Plan. The plan allows you to take up to $35,000 tax-free from the account. For more information on the Home Buyers Plan check out the government of Canada’s website.