Canadian citizens having earned income and have a social security number and have filed a tax return may contribute funds into a Registered Retirement Savings Plan(RRSP) to reduce the amount of income taxes paid. This can be done each year until the individual’s spouse reaches the age of 71. RRSPs can be opened in financial institutions or banks registered by the Canadian government. The savings placed in these accounts are tax deductible as long as they remain in the account. The maximum amount that could be contributed for the 2019 tax season is $26,500. This amount will be increased to $27,230 for the 2020 tax year. The deadline for making contributions is 60 days following the end of the tax. These contributions can be made in cash as well as stock or security holdings.
“If you’re like many Canadians, you’re hoping you’ve paid enough tax in 2019 and may even be looking forward to a hefty tax refund. You can help ensure that happens by knowing the details of your Registered Retirement Savings Plan (RRSP), what sets them apart, your contribution limit and a whole slew of other things.”