What is a Registered Retirement Savings Plan (RRSP)?
An RRSP is a registered savings plan that defers tax to assist individuals in saving for their retirement years. RRSP contributions are tax-deductible for the tax year in which they were made or, if contributed during the first 60 days of a subsequent year, can be claimed for the current year or for the previous tax year. Contributions are limited to the lesser of an annual dollar amount or 18% of the previous year’s earned income. An RRSP can continue until the end of the year the annuitant reaches age 71. Special options under this plan include a spousal RRSP and contribution carry-forward provisions.