Group RRSP question

[wolverine]

The company I work for began matching contributions to the Group RRSP plan last year. I just received my receipt for my income tax return and the amount has both my payroll contribution and the employer contribution.

So my question is, can I really deduct both contributions (mine and employers) on my tax return? Or did I get a fucked-up tax return receipt?

I'm resourceful enough to try googling this info and even searched Revenue Canada's website, but can't find anything that specifically confirms this.

 

[luvsdaty]

Might be a good question for an accountant? Good luck with your search.

 

[Ray]

Your T4 will indicate your portion of the contribution in box 20.

Box 52 will show total contribution, yours and your employer.

It always works out in the end.

 

[wolverine]

Your T4 will indicate your portion of the contribution in box 20.

Box 52 will show total contribution, yours and your employer.

It always works out in the end.

I didn't get my T4 yet, I got the RRSP receipt for March-Dec from the financial provider. Which again, has both mine and employer contributions in one amount.

 

[threepeat]

The company I work for began matching contributions to the Group RRSP plan last year. I just received my receipt for my income tax return and the amount has both my payroll contribution and the employer contribution.

So my question is, can I really deduct both contributions (mine and employers) on my tax return? Or did I get a fucked-up tax return receipt?

I'm resourceful enough to try googling this info and even searched Revenue Canada's website, but can't find anything that specifically confirms this.

Hi Wolvie, try this thread... http://forums.redflagdeals.com/rrsp-employer-match-contributions-tax-question-688534/

The most useful post from the above thread seems to be this one:

Q: But you cannot claim the employer's contribution in your tax return, correct?
A: No, you can and should. The employer's contribution counts as a taxable benefit. It also counts as a contribution that you can deduct. So if you choose to deduct it in the same tax year as the contribution, then for tax purposes it's basically a wash.

 

[Aeiyah]

The Group RRSP provider is responsible for issuing tax receipts. Generally, they will provide you with 2 receipts, one showing contributions made after the first 60 days of the calendar year (i.e. for the period March - December 2010). In early March, they will issue a second receipt for contributions that are made in the first 60 days of 2011.

The receipts show total contributions and don't distinguish between employer and your own contributions (Canada Revenue Agency doesn't care about the source of the contributions, only the total amount). If you want to get into the technical details, the employer contributions are added to your total taxable income, and then deducted. The reason for this is that the Income Tax Act does not allow employers to make direct contributions to an RRSP.

If you check your payroll stubs, you will notice that the employer RRSP contributions have been added to your taxable income. However, no withholding taxes will have actually been sent to CRA on this amount, that is as long as your employer has sent the money directly to the RRSP provider.

 

[wolverine]

Thanks, 3peat - very helpful thread! Thanks Aeiyah.

 

[JohnT]

Just be careful you don't over-contribute past your RRSP limit if you are going to contribute outside of your RRSP group plan.

 

[a_shy_guy]

Just be careful you don't over-contribute past your RRSP limit if you are going to contribute outside of your RRSP group plan.

Unless someone has contributed the allowed 18% from the time they recieved their first paycheque, to now, I dont think its a huge concern. I cant think of many people that contributed from that early, although I do understand what your getting at. I started a few years ago, and i'm quickly catching up, but to be fair, i only worked for maybe 5.5 years so far.

 

[FunSugarDaddy]

I believe the answer to this question is as follows:

1. The employer contribution is a taxable benefit that would form part of box 14. Box 20 is for pension contributions.

2. You should get RRSP slips as mentioned above. One for the contributions between March 2 - Dec 31, 2010 and either one for Jan - Mar 1, 2011, or more common, one for each month. These contribution slips should total both yours and your employers contributions.

This is basically the same answer as Aeiyah's.