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)


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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)

Ash20   
Member since: Apr 06
Posts: 443
Location:

Post ID: #PID Posted on: 18-02-09 01:08:52

Please see the guide (RC4135) in the link provided by you and you can see on page-4 the 90 day rule.

For your other question, answer is yes, but there is a maximum limit of contributing $18K per calender year.

I am not an expert and somebody else can confirm.


Quote:
Originally posted by frnd

Quote:
Originally posted by hchheda

Quote:
Originally posted by frnd

Hello CDs,


Can I withdraw (without paying TAX) this 20,000 under HBP in July-2009 if I am buying my first home in Canada?

Thanks in adv.,



I am not an expert, but you cannot withdraw under HBP until 90 days after investing.

Good luck.

Hiren



Thanks for taking the question quickly, Hiren.
I am reading this CRA link now, so far haven’t come across any such rule.
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/rrsp-reer/hbp-rap/cndtns/menu-eng.html

Also, you said 90 days after investing. Can I invest in March before I get notice of assessment for 2008 (+2007) tax year. I know the contribution limit as I have T4 from my employer? If yes, can I withdraw the total after 90 days in July, 2009?



Blue_Peafowl   
Member since: Dec 08
Posts: 1351
Location: Brampton, Ont, Canada

Post ID: #PID Posted on: 18-02-09 09:38:47

I have two questions: RRSP and RESP

RRSP: I am planning to go back in India after 20 years from now at age of 55.
I am not worrying to much about retirement because hv my based setup, I have land and I m going to build small house where I can spend my last days.
Does RRSP is the only choice or should I invest some money in other stuff which will help me in my old age. (Not to forget as Canadian citizen will have money coming from government after 65.)

So what are the best options RRSP or any other investment?

RESP: I hv two young kids ( one year and newly born) , I wanna put money for them from now, not just for education but also when they are old enough to get marry I can use that money. I am thinking of opening up separate account for them so after 20-25 I don’t have to worry about putting money on their education as well as like marriage or other big expense.
RESP is good only for education purpose but I don’t like to hold my money – I would like to use them when I needed for them – either education, marriage or some other big expenses

BOTTOM LINE IS EITHER ON RRSP OR RESP I WANT FULL FREEDOME TO USE MY INVESTMENT – WHILE HERE I AM KIND OF STUCK WITH CERTAIN CONDITIONS.

ANY ADVICE?


-----------------------------------------------------------------
'Some goals are so worthy, it's glorious even to fail.' (Param Vir Chakra awardee Lt. Manoj Pandey)


frnd   
Member since: May 07
Posts: 239
Location: GTA

Post ID: #PID Posted on: 18-02-09 10:15:23

Quote:
Originally posted by Ash20

Please see the guide (RC4135) in the link provided by you and you can see on page-4 the 90 day rule.

For your other question, answer is yes, but there is a maximum limit of contributing $18K per calender year.

I am not an expert and somebody else can confirm.




Thanks Ash20, I downloaded the guide last night, will read it today. With detailed shared by Hiren, Ash20 and as per my example can I contribute 10,000 before due date (2nd March) for last year and 10,000 on 3rd March for current year (before I receive notice of assessment of 2008) to withdraw the total 20,000 after 90 days in June 2009?

Thanks,
PS: Feel free to share your thoughts although you are not an expert, I’ll confirm any detail given.



Pramod Chopra   
Member since: Sep 03
Posts: 1284
Location: Pickering, ON

Post ID: #PID Posted on: 18-02-09 13:03:57

Quote:
Originally posted by frnd..........................

For example in my last year (2008) Notice of assessment my contribution limit is 10,000. And this year (2009) expected contribution limit is the same 10,000 to make this simple.

I don’t invest any money in RRSP by 2nd Mach 2009 which is dead line. When I get my Notice of assessment for this year which says my limit is 10,000 say in May-2009.

Can I invest 20,000 (2008+2009) at once as soon I get this year NOA say in June-2009?

Can I withdraw (without paying TAX) this 20,000 under HBP in July-2009 if I am buying my first home in Canada?

Thanks in adv.,



When you filed your return in April 2008, it was for your 2007 tax year and the notice of assessment you received in 2008 was also for your 2007 tax year and the RRSP contribution limit it showed was for your income till December, 2007.

Whatever you earned in year 2008 will also generate RRSP contribution limit and you could have started contributing for the same in 2008 by using regular monthly contributions through your salary or you can can contribute for that now in lump sum. If you contribute before 2nd March, 2009 you would be able to take the benefit of deducting the contribution up to the limit you received in your NOA for 2007 tax year for the 2008 tax year return. The rest can be carried forward and deducted in 2009 tax year return or in any future return.

You can make this total contribution and let it remain in the RRSP for 90 days and then can withdraw under HBP to buy a house if you are an eligible first time home buyer. Mind you, the latest budget has increased the HBP limit to $25,000 so you can take further advantage.

If you still have any confusion then you should contact an accountant or tax filer to have this clarified. If you do not know any one, you are welcomed to contact me with details and I will explain.

Good Luck.


.


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


Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada



Pramod Chopra   
Member since: Sep 03
Posts: 1284
Location: Pickering, ON

Post ID: #PID Posted on: 18-02-09 13:10:29

Quote:
Originally posted by Blue_Peafowl

I have two questions: RRSP and RESP

RRSP: I am planning to go back in India after 20 years from now at age of 55.
I am not worrying to much about retirement because hv my based setup, I have land and I m going to build small house where I can spend my last days.
Does RRSP is the only choice or should I invest some money in other stuff which will help me in my old age. (Not to forget as Canadian citizen will have money coming from government after 65.)

So what are the best options RRSP or any other investment?

RESP: I hv two young kids ( one year and newly born) , I wanna put money for them from now, not just for education but also when they are old enough to get marry I can use that money. I am thinking of opening up separate account for them so after 20-25 I don’t have to worry about putting money on their education as well as like marriage or other big expense.
RESP is good only for education purpose but I don’t like to hold my money – I would like to use them when I needed for them – either education, marriage or some other big expenses

BOTTOM LINE IS EITHER ON RRSP OR RESP I WANT FULL FREEDOME TO USE MY INVESTMENT – WHILE HERE I AM KIND OF STUCK WITH CERTAIN CONDITIONS.

ANY ADVICE?



You would be better off seeing a professional and discuss your situation in detail personally and then take any decision.


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


Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada



kisi143   
Member since: Aug 06
Posts: 155
Location: Ottawa

Post ID: #PID Posted on: 18-02-09 14:14:08

Dear Pramod ji,
Could you please check your PM.
Thanks,
~K



Blue_Peafowl   
Member since: Dec 08
Posts: 1351
Location: Brampton, Ont, Canada

Post ID: #PID Posted on: 18-02-09 14:35:40

I will surely go see professional and discuss my situation

But i would still like to know the opinion from CD's so i hv better understanding and that can help me ask question to professional.

I am sure there is others have same thinking like mine and by bringing this up we are going to help others too.


-----------------------------------------------------------------
'Some goals are so worthy, it's glorious even to fail.' (Param Vir Chakra awardee Lt. Manoj Pandey)



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