March 2, 2020 is the deadline for contributing to an RRSP for the 2019 tax year. Your right to make an RRSP contribution for one year depends on your earned income for the previous year. For 2020, your contribution will be limited to 18% of your 2019 earned income, to a maximum of $27,230 plus any carry-forward contribution room that you may have. This information can be found on your 2019 Notice of Assessment or on your MYCRA account.
Tax Free Savings Accounts (TFSA) Contributions
The TFSA new contribution limit for 2020 is $6,000, matching the amount set for 2019, With this TFSA dollar limit announcement, the total contribution room available in 2020 for someone who has never contributed and has been eligible for the TFSA since its introduction in 2009 is $69,500.
Registered Disability Savings Plan (RDSP) Contributions
The deadline for contributions each year to an RDSP is Dec. 31 of that year.
To help you save, the Government pays a matching grant of up to $3,500, depending on the amount contributed and your family income. The Government also pays a bond of up to $1,000 a year into the RDSP's of low-income and modest-income Canadians. Grants and bonds are paid until the year the beneficiary turns 49.
The RDSP Plan Institure reports that "the number of accounts currently set up represents only about 11 per cent of the roughly 550,000 Canadians who would be eligible for an RDSP, showing that the plans are underused, even by their main target group – disabled individuals and their families. You should consider opening a Registered Disability Savings Plan (RDSP) if you have a long-term disability and are under age 60, a Canadian resident with a Social Insurance Number, are eligible for the Disability Tax Credit and are looking for a long-term savings plan."
Please feel free to call our office at 204 822 6887 if you have questions about these planning opportunities.