A
RRSP is a retirement plan that Canada Revenue
Agency registers and that you or your spouse
or common-law partner establish and contribute
to. Deductible RRSP contributions can be used
to reduce your tax.
Any
income you earn in the RRSP is usually exempt
from tax for the time the funds remain in
the plan. However, you generally have to
pay tax when you cash in, make withdrawals,
or receive payments from the plan.
Types
of RRSPs - Individual or Spousal
Individual
RRSPs are set up under your name and can
reduce your personal income tax with deductible
RRSP contributions.
You
may also want to set up a spousal or common-law
partner RRSP. This type of plan can help
ensure that retirement income is more evenly
split between both of you. The benefit is
greatest if a higher-income spouse or common-law
partner contributes to an RRSP for a lower-income
spouse or common-law partner. The contributor
receives the short term benefit of the tax
deduction for the contributions, while the
annuitant, who is likely to be in a lower
tax bracket during retirement, receives
the income and reports it on his or her
tax return.
Contribution
Room
Your
RRSP deduction limit can be found on your
latest Notice of Assessment or Notice of Reassessment.
You can also find out about your contribution
room by registering for My Account
on the Canada
Revenue Agency website.
WHAT
IS A STRESSLESS RRSP?
The
Stressless RRSP is a RRSP contract offered
only through Thom and Associates Financial
Planners Inc. and the insurance company Industrial
Alliance Pacific.
The
Stressless RRSP takes approximately 15 minutes
to complete.
