Welcome Guest!Register Login Contact Us Site Map FAQ

Home

Charcha

Select section:

RRSP 101 (All RSP questions answered)

Poll:RRSP 101 (All RSP questions answered)
Choice		Stats
I find this info useful, thanks.	83% (20)
this is basic info, i know this already!	17% (4)

Jump to Page:
< Previous [ 1 ] [ 2 ] [ 3 ] [ 4 ] [ 5 ] [ 6 ] [ 7 ] [ 8 ] [ 9 ] [ 10 ] [ 11 ] [ 12 ] [ 13 ] [ 14 ] [ 15 ] [ 16 ] [ 17 ] [ 18 ] Next >

Poll:RRSP 101 (All RSP questions answered)
Choice		Stats
I find this info useful, thanks.	83% (20)
this is basic info, i know this already!	17% (4)

Pramod Chopra
Member since: Sep 03

Posts: 1284
Location: Pickering, ON
Post ID: #PID

Posted on: 27-12-07 15:34:59

Quote:
Originally posted by Iceberg

Hi

I do not understand this. ...........

Now if have a deduction limit of 6.5K and and my wife has a limit of 3 K, and I contribute 3K to her spousal plan and 3 K to my personal plan, I can claim 6 K from my 2007 taxes. Is that Correct? And if she withdraws from he spousal plan in 2008 will I have to include that as my income for 2008? My understanding from the CRA web page above is that I shall have to, can you confirm this.

Quote:

Shah,

What Investpro was saying ...........

Does that make sense?

V

Yes !

Your understanding of this is correct.

In your example above, you can claim RRSP deduction of $6 k in your 2007 tax retrun and you would have to report whatever amount your wife withdraws in 2008 in your 2008 tax return.

-----------------------------------------------------------------

Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada

investpro
Member since: Nov 06

Posts: 1628
Location: carl sagan's universe
Post ID: #PID

Posted on: 27-12-07 17:27:28

Hi Iceberg,

As usual I will confound or clarify the issue since I do not really have the full picture.

As per your question regarding withdrawal from the SPOUSAL plan, you are correct.

However, let us assume that upto 2006 your wife was working and had contributed to her own RRSP, and has say $5,000 in RRSP from her own contributions, and this year say due to having a child she went on mat leave and does not contribute to her RRSP but you contribute 3k as in your example as she has room. She now has 8K in her RRSP a/c, 5k from own and 3K from you.
In the event she withdraws in 2008, but withdraws less than $5,000 that she had already contributed from her own funds, then you will not have to include it in your income.However if she withdraws 6k, which is higher than the 5k she contributed then you will have to include 1k in your income and 5K as her income.

I am sure a tax specialist will confirm this.

I gave you the scenario above as I have seen it happen several times. If as a family you need the RRSP money later on, it is more tax efficient to withdraw from spouse's own contributions than from spousal plan.

There are more scenarios, but I just gave you one. You can have the RRSP withdrawals included in both your and her incomes even if she withdraws less than 5k

Clear as mud?

VJ
Member since: Mar 04

Posts: 441
Location: Mississauga-Canada
Post ID: #PID

Posted on: 28-12-07 12:43:44

Deleted

Iceberg
Member since: May 05

Posts: 919
Location: GTA and beyond
Post ID: #PID

Posted on: 28-12-07 13:32:59

Deleted

Pramod Chopra
Member since: Sep 03

Posts: 1284
Location: Pickering, ON
Post ID: #PID

Posted on: 28-12-07 14:06:12

Quote:
Originally posted by VJ

Hi Tax advisers,

Can someone suggest me the right kind of RRSp purchase in our case,

My RRSP contribution room - $2200
My wife's RRSP contribution room - $5500

My gross income in 2007 - $70,000
My wife's gross income in 2007 - $42,000

So, please suggest me, how should we buy the RRSPs. Plus can I over contribute the available $2000 and get the tax deduction for the current year?

Rgds,

Jwalant.

Hi VJ,

Buying RRSPs is a serious decision and should be done by discussing your personal financial situation with your financial planner. He/She would be in a much better situation to suggest you which type of RRSP (weather personal or spousal) and what type of investment choice would be better for you according to your time horizon, earning potential and risk tolerance.

As far as your question about 'over contribution' is concerned then as the word suggest 'over contribution' which means you are contributing over the limit and hence you can not claim it for tax deduction in current year. However, the same would be carried forward to future years as 'undeducted contribution' and can be deducted in future at the most opportune time.

-----------------------------------------------------------------

Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada

Mr.Scorpio
Member since: Jun 04

Posts: 75
Location: Toronto (416-7305795)
Post ID: #PID

Posted on: 28-12-07 17:18:58

Quote:
Originally posted by VJ

Hi Tax advisers,

Can someone suggest me the right kind of RRSp purchase in our case,

My RRSP contribution room - $2200
My wife's RRSP contribution room - $5500

My gross income in 2007 - $70,000
My wife's gross income in 2007 - $42,000

So, please suggest me, how should we buy the RRSPs. Plus can I over contribute the available $2000 and get the tax deduction for the current year?

Rgds,

Jwalant.

Hi Jwalant:

Investment in RRSP should be in line with your financial goals.Best for you would be to discuss with your Financial Advisor and make the appropriate selection.
Rgds

-----------------------------------------------------------------
TS

investpro
Member since: Nov 06

Posts: 1628
Location: carl sagan's universe
Post ID: #PID

Posted on: 29-12-07 05:14:34

Quote:
Originally posted by VJ

Hi Tax advisers,

Can someone suggest me the right kind of RRSp purchase in our case,

My RRSP contribution room - $2200
My wife's RRSP contribution room - $5500

My gross income in 2007 - $70,000
My wife's gross income in 2007 - $42,000

So, please suggest me, how should we buy the RRSPs. Plus can I over contribute the available $2000 and get the tax deduction for the current year?

Rgds,

VJ

Hi VJ,

I am not a tax advisor, but there is something that does not gel here. If your gross income is $70,000 for 2007, then your RRSP contribution room is 18% of that or $11,600 so how do you get $2200?
Similarly for your wife.
I am shooting in the dark here, but is the $2,200 the DEDUCTIBLE limit on your last NOA? If that is the case then your contribution limit is $11,600 plus $2,200 plus $2,000(over contribution) minus any unused contribution stated on your NOA.How much of that is tax deductible is another situation.

Also I believe you are helping people with their RESPs and are also LLQP licensed, so I imagine you also give some sort of tax advise to your clients and are quite proficient at judging risk tolerances.I am sure you know that if your gross income from being self-employed is X, you can put in expenses and whittle it down to Y and pay tax accordingly.Also there are excellent seg funds to invest in.
Also if you are self-employed there is IPP you can look at for cutting down taxes.
There are also labour sponsored funds you can use to reduce your tax burden.
Best to see a tax specialist and LSIF licensed person on this.The LSIF limit has gone up to $7,500 this year from $5,000 in the past.
I am self-employed and yet I have someone to do my taxes, as along with his advice and knowledge I have, I end up with lowering my tax burden considerably. Over time one may become proficient enough to know exactly how much your tax burden is but at the outset a good tax guy can really save you a bundle.
Again I have given you counsel shooting in the dark, but even that helps many a time.

Contributors: investpro(34) Pramod Chopra(11) DP_gta(6) reachash(6) frnd(5) TO-Puttar(4) Fido(4) regar(4) Mr.Scorpio(4) Ash20(4) sallusworld(3) Big Vee(3) desiM(3) Blue_Peafowl(2) Shah(2) Iceberg(2) pratickm(2) VJ(2) Val(2) dp_jain(1) kisi143(1) rsbagwell(1) BlueLobster(1) Bingo(1) parth1970(1) Toronto_Puttar(1) ihpatel(1) JRF(1) RESP(1) desipyare(1) sw33tc0rn(1) rajvikas(1) blabber(1) surtalme(1) Full House(1) sendneeraj(1) hchheda(1) sumjo(1)

Jump to Page: < Previous [ 1 ] [ 2 ] [ 3 ] [ 4 ] [ 5 ] [ 6 ] [ 7 ] [ 8 ] [ 9 ] [ 10 ] [ 11 ] [ 12 ] [ 13 ] [ 14 ] [ 15 ] [ 16 ] [ 17 ] [ 18 ] Next >

Show Printable version

Send this page to a friend

Add to favorites

Discussions similar to: RRSP 101 (All RSP questions answered)
	Topic	Forum	Views	Replies
	Nine ways to save on taxes using RRSPs ( 1 2 3 )	Financial Planning	5784	19
	Sticky: RRSP 101 (All RSP questions answered) ( 1 2 3 ... Last ) Tax benefits for Canadian Residents	Financial Planning	128886	121
	Question on Home Buyer's Plan	Real Estate & Mortgages	1688	5
	Question about Spousal RRSP and HBP	Accounting and Taxation	3652	3
	spouser RRSP verses Own RRSP	Financial Planning	2074	3
	Details about RRSP & Comparison with 401K plan	Accounting and Taxation	1645	1
	What if you contribute more than your RRSP contribution limit	Accounting and Taxation	1897	4
	Tax Test-R U smarter than the av Can?	Accounting and Taxation	1753	0
	Spousal RRSP Query	Life	2158	5
	RRSP/Tax refund Question!!	General	2166	4
	TAX return ( 1 2 )	Accounting and Taxation	2784	8
	Landing in 9th Dec ... joined cmpany in 20th may 2008	Accounting and Taxation	1617	2
	Spousal RRSP withdrawal under HBP	Accounting and Taxation	1710	2
	RRSP limit ( 1 2 )	Financial Planning	2213	7
	RRSP - Jan to Dec Schedule	Financial Planning	2016	3
	Question about Tax Return	Accounting and Taxation	1396	2
	RRSP contribution	Financial Planning	1437	2
	Tax Deduction Questions: A lot of	Accounting and Taxation	2215	4
	Spouse RRSP ( 1 2 )	Financial Planning	5259	13
	RRSP contribution and panelty	Accounting and Taxation	1934	5
	Spousal RRSP and HBP	Accounting and Taxation	1832	3
	Withdrawal from personal RSP under LLP and contributing towards spousal RSP ( 1 2 )	Financial Planning	4200	13
	employer pension plan ( 1 2 )	Financial Planning	5522	11
	Question related to RRSP Unused Contribution ( 1 2 )	Financial Planning	2701	7
	RRSP after returning to India	Our Native Country!	4682	5

Charcha

RRSP 101 (All RSP questions answered)

Discussions similar to: RRSP 101 (All RSP questions answered)