Welcome to the 2019 tax season!
As we’re getting close to deadlines for RRSP contributions in 2020, I thought I would provide a quick rundown of the options available to clients who wish to contribute to their accounts, along with some additional information to simplify your financial housekeeping.
Note that the deadline for making a 2019 RRSP contribution is March 2nd, 2020.
To contribute to your RRSP account (or any of your investment accounts), you have three options:
- Online Banking option:
Using your current online banking, add National Bank Independent Network to your “payees”, and add your RRSP account number.
- I can pick up your cheque:
Time permitting, I can pick up your cheque from your preferred location. Simply use my Online Calendar and select In-Person Meeting, then pick the best date, time and location of your choice for me to come and pick up your cheque –perhaps we can even grab a cup of coffee and catch up at the same time;
- Snail mail option:
Or, draft a cheque payable to National Bank Independent Network, making sure that your RRSP account number is added to the memo line. You can then send/courier the cheque to:
Attn: WealthLife Capital Client Services
5160 Yonge St., Suite 1860
Toronto, Ontario, M2N 6L9
Alternatively, you can send your cheque to our Kanata location and we will forward the cheque to head office on your behalf –you should only use this last option if there is enough time before the deadline.
Noteworthy facts about RRSPs:
- If you earn income and file an income tax return in Canada, you may contribute to your RRSP until December 31 of the year you turn 71.
- To confirm your personal RRSP contribution room, please refer to CRA My Account.
- Contributions are tax deductible.
- What you earn within your RRSP (interest, dividends and/or capital gains) is sheltered from tax. The younger you are, the more important this tax sheltering can be.
- Tax deferral can be powerful, but there are delayed consequences. Making contributions may be a great option when you’re in a high tax bracket today and anticipate being in a lower bracket at retirement. If this doesn’t describe your situation, then TFSA contributions may be more advantageous. We can help you assess which option is best.
- Recent changes to our tax rules allow splitting RRSP income after age 65. While Spousal RRSPs can still be useful, they are not as critical as they used to be.
- You can contribute one year but delay the deduction to a future year. You do this when you anticipate being in a higher tax bracket in the future (work promotion, sale of a taxable property, severance payment etc.). Your contribution goes in now, to benefit from the tax sheltering, but you delay the deduction to a future year for a bigger tax bang.
We’ve prepared this document which provides key dates for the 2019 tax period for registered and unregistered accounts. We trust the attached information will help you prepare your 2019 taxes. As always, consult with your accountant or tax specialist on the most appropriate tax treatment for your particular situation.
- Non-registered account fees are tax deductible.
- Our pooled funds are considered Canadian investment property and are exempt from T1135 CRA tax reporting.
- The Realized Gains/Losses Summary will be available in your tax portal* by March 13, 2020.
- If applicable, a Foreign Property Report is available upon request.
*If you don’t know about our free tax portal option, contact us and we’ll set it up for you.
If you have any questions about your 2019 RRSP contribution or any other financial planning questions, please contact us.