Registered Retirement Savings Plan Contribution

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Registered Retirement Savings Plan Contribution

An amount of money that a worker places into a Registered Retirement Savings Plan at regular intervals. In Canada, an RRSP is an account into which a worker may make these contributions up to a certain limit throughout his/her working life, and from which he/she begins to take distributions following retirement. The contributions are tax deductible, and they are invested in securities, usually common stock and certificates of deposit.
References in periodicals archive ?
The ITA prescribes a Pension Adjustment (PA), which reduces RRSP contribution room by the deemed value of retirement benefits earned in the previous year, multiplied by nine (the Factor), minus $600--which adds back a small amount of contribution room in recognition of the fact that not all DB plans have the ancillary benefits assumed by the Factor.
33) However, there is still a large unused RRSP contribution room as of 2011 amounting to over $680 billion.
However, note that both the employer's and employee's contributions will reduce the employee's available RRSP contribution room in the following year.
According to the study, nearly two-thirds (64 percent) will be making an RRSP contribution before the March 2, 2015 deadline.
Respondents were asked to complete the sentence, "When making an RRSP contribution, we feel ," by choosing as many words as they wanted from a list provided.
According to the study, nearly two-thirds of Canadians have made or plan to make an RRSP contribution.
Currently, the average RRSP contribution in Canada is between USD2,000 and USD2,500 a year.
Allowable RRSP contribution is the lower of: 18 per cent of earned income from the previous year or the maximum annual contribution limit for the taxation year (RRSP contribution room for 2008, 2009 and 2010 are $20,000, $21,000 and $22,000 respectively) or the remaining limit after any company sponsored pension plan contributions.
Members electing to opt out would continue to receive their existing remuneration and RRSP contribution framework.
Budget 1999 eliminated surtaxes on the wealthiest Canadians; Budget 2000 dropped the corporate income-tax rate from 28 to 21 per cent; and Budget 2003 benefited the wealthiest eight per cent of tax filers by increasing the RRSP contribution exemption.
A $1,000 RRSP contribution earning ten percent return grows to nearly $11,000 in 25 years, compared to just $9,800 in 24 years.
By increasing RRSP contribution limits and establishing the carry-forward provision, the Government is encouraging individual Canadians to prepare for self-sufficient retirement.