Do I need to deduct all of my RRSP contributions in the tax year they were made?

No, there is no requirement for you to deduct contributions to an RRSP in your income tax return for that year. RRSP contributions have a two-step procedure when completing your income tax return. The first is to record your contribution by including your contribution receipts with your income tax return (Schedule 7, RRSP Unused Contributions, Transfers, and HBP or LLP Activities). This lets Canada Revenue Agency (CRA) know that you have made the contributions so they can make sure that you are entitled to make the contributions and that you have not over-contributed to your RRSP. The second step is to request CRA deduct from your taxable income all or a portion of your RRSP contributions. There is no requirement that you must deduct all RRSP contributions from your taxable income.

You may decide to save a portion of your RRSP contributions for a deduction in future years when your taxable income will be greater. This would allow your RRSP investment earnings, on the un-deducted RRSP contributions, to be sheltered from income tax, while saving the RRSP deduction for future years.

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