RRSP Contribution Deadline – Wednesday, March 1, 2023

RRSP contribution eligibility:

• Anyone who has earned income and filed a tax return can contribute until December 31 of the year they turn age 71
• Spousal RRSPs can be used until December 31 of the year the spouse turns age 71

Should you be using or topping up your RRSPs?
If you’re not sure, please get in touch ASAP to further discuss your specific situation.

Contribution limits and where you find your limit:

The annual RRSP contribution limit is the lower of 18% of your earned income from the previous year or the maximum annual contribution limit coupled with unused contribution room from past years. RRSP contribution room can be carried forward to subsequent years if you don’t maximize your room this year. There is also a one-time $2000 lifetime over-contribution allowance.
> Here is a chart indicating the maximums on past years

For your personal contribution limit, please check your most recent Notice of Assessment from your MyCRA portal.

The power of Dollar-cost averaging:
We are huge advocates of automating your long-term savings contributions as it’s one of the best ways for forced savings. Dollar cost averaging means you buy more units when the prices are low and less units when prices are high.

Spousal RRSP:
This strategy makes sense for spouses where one spouse earns more than the other spouse. This allows for the higher income spouse to deduct the contribution on their taxes and for the lower income spouse to own the RRSP. This is a great way to be proactive about future income splitting.

RRSP Contribution Calculator:
A common question we often get is how much their tax deduction will clients receive.
> Here is a calculator that will provide an estimate of your tax savings

First Time Home Buyer’s Plan (FHP) and Lifelong Learning Plan (LLP)
If you have taken advantage of one or both of these programs, please remember to contribute and allocate the specified amount as noted on your notice of assessment when you file your taxes. Otherwise, the repayment amount will be added to your income. For example, if you took out funds in 2020 to purchase your first home, your first repayment is due for the 2022 tax year and you have 15 years to repay what you took out.

For the lifelong learning plan, you also have a 2 year grace period before repayment begins except you have 10 years to repay the amount you took out.

VERY IMPORTANT-

You will not receive a further tax deduction on repayments since you already received the tax deduction the first time around. Please get in touch if you have any questions about your RRSP situation.

TFSA Annual Contribution Limit Increase

As of January 01, 2023, the new TFSA contribution annual limit is $6500. Find your annual limit and it is prorated accordingly based on the year you turned 18 years old. In BC, you have to be 19 years old to have a TFSA account but you can put two years worth of contributions at that time. For those of you who immigrated to Canada, the TFSA is also prorated based on when you land in land.

You can also find your TFSA contribution limit and contribution history on the MyCRA portal. Please let us know if you have any questions.

DLD Charitable Impact in 2022

The DLD team places great importance in giving back to our community. We give back through our time and monetary donations.

In 2022 – we are proud to report that collectively, we contributed $57,000 through fundraising and donations to organizations including: Hockey Helps the Homeless, The Shred Foundation, Movember, BC Children’s Hospital, BC Cancer Agency, The Chinatown Foundation, Food Banks BC, St. Paul’s Foundation, Canadian Red Cross, I’m a HIPpy and The Coldest Night of the Year.

Happy New Year from the DLD Team! Thank you for your continued trust and support. We look forward to an amazing 2023!

Please do not hesitate to contact us if you have any questions or if there’s anything we can do to help.

Thank you for your time.
Dave, Kelly and Ryan

E&OE