RRSP Quick Tips
More information here
As we come into the start of February, the deadline for RRSP contributions to count for the 2023 tax year is getting closer. RRSP contributions are valuable as a tax-saving strategy in the year you contribute, and tax-sheltering opportunity for every year until you start to withdraw. The amount of available room can be found on your 2022 Notice of Assessment.
If you have RRSP room and would like to make an RRSP contribution prior to the February 29th deadline, there are now a number of ways that it can be done:
1) a “reverse bankwire” from an RBC bank account (just call the office with the amount you need transferred)
2) a direct transfer from an RBC bank account using Wealth Management Online
3) an electronic bill payment (we can walk you through it if you need)
4) a cheque made out to RBC Dominion Securities (we can send a courier or you can mail it or drop it off)
5) with a transfer from another investment account, such as your non-registered account (call us to discuss)
If you are turning 71 this year your RRSP will be converted into a RRIF (Registered Retirement Income Fund) by December 31st, 2024. We will contact you in the fall for the required signing of documents. Learn more about RRIF accounts here.
TFSAs
More information here
With the start of the New Year, each Canadian over the age of 18 now has an additional $7,000 of TFSA contribution room, bringing the lifetime total contribution room to as much as $95,000. Contributions to TFSAs can be done in the same manner as RRSP accounts.
| Year | Contribution Limit Per Year |
| 2009 - 2012 | $5,000 |
| 2013 - 2014 | $5,500 |
| 2015 | $10,000 |
| 2016 - 2018 | $5,500 |
| 2019 - 2022 | $6,000 |
| 2023 | $6,500 |
| 2024 | $7,000 |
RESPs
More information here
Reminder, as well, that RESPs are an excellent way for parents and grandparents to encourage children on a lifelong learning journey. They also provide a great grant opportunity: the Canadian Education Savings Grant provides up to $500 per year per child of extra funds to an RESP.
(New) First Home Savings Accounts
More information here
The new First Home Savings Account came into effect April 1, 2023 and offers $8,000 per year of tax deductible contributions (like an RRSP) to a lifetime maximum of $40,000 for anyone over 18 who hasn’t owned a home in the past 4 years. Unused room may be carried over to future years. Withdrawals—both principal and growth—are tax free (like a TFSA withdrawal). Parents or grandparents who are hoping to help children to buy their first home would be wise to consider taking advantage of these accounts.
Tax
Finally, it’s tax time. In a lot of cases, we have our clients’ accountants set up as Interested Parties to receive duplicate tax packages and custom reporting (income summaries, T1135 reports, etc.). If we don’t already, and you’d like us to work directly with your accountant, too, just let us know. And if you’d like to stop receiving paper tax forms, either because we’re already sending them to your accountant, or because you’d like to reduce the amount of paper coming to the house, we would be happy to help get you set up for eTax statements.
If you’d like to have a discussion about any of the above, strategies for investment, financial planning, or any other topic, please feel free to respond to this email, or give our office a call and we can schedule a time to talk.
Sincerely,
Samuel S. McLaughlin, CIM, FCSI, FEA
Senior Portfolio Manager & Wealth Advisor
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