CTP13_Chapter_10

2014 clarence byrd inc 11 canadian tax principles

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Unformatted text preview: Dollar Limit Year Money Purchase Limit RRSP Dollar Limit 2011 $22,970 $22,450 201 $23,820 $22,970 2013 $24,270 $23,820 2014 Indexed $24,270 Copyright © 2014, Clarence Byrd Inc. 12 Canadian Tax Principles Registered Retirement Savings Plans • Earned Income – ITA 146(1) – Employment Income – Business Income (Loss) – Disability Payments – Royalties (If Creator Of Asset) – Net Rental Income (Loss) – Net Research Grants Received – Spousal Support Received (Paid) Copyright © 2014, Clarence Byrd Inc. 13 Canadian Tax Principles Registered Retirement Savings Plans • Integration – PAs - Money Purchase Plans • Employee + Employer Contributions • RPPs And DPSPs – PAs - Defined Benefit Plans = (9)(Benefit) – PSPAs – PARs Copyright © 2014, Clarence Byrd Inc. 14 Canadian Tax Principles Registered Retirement Savings Plans • Carry Forward Provisions – Undeducted Contributions • Carry Forward Until Death – Unused RRSP Deduction Room • Meaning • No Time Limit Copyright © 2014, Clarence Byrd Inc. 15 Canadian Tax Principles Registered Retirement Savings Plans • Excess Contributions – General Rules • Meaning Of Excess Contributions: Meaning Contributions That Are More Than $2,000 Greater Than Unused Deduction Room Than • Penalty Of 1% Per Month Copyright © 2014, Clarence Byrd Inc. 16 Canadian Tax Principles Registered Retirement Savings Plans • Excess Contributions – Tax Planning • If Withdrawn Within One Year After The Year If Assessment Received For Year Of Contribution: Can Deduct Under ITA 146(8.2) Can • Otherwise: Taxed When Withdrawn • Can be deducted in any future year that has sufficient Can room room Copyright © 2014, Clarence Byrd Inc. 17 Canadian Tax Principles Registered Retirement Savings Plans • Options At Retirement – Age 71 - Must Collapse – Lump Sum Withdrawal Lump – Annuities • Life Annuity (Single or Joint) • Fixed Term – Transfer To RRIF Copyright © 2014, Clarence Byrd Inc. 18 Canadian Tax Principles Registered Retirement Savings Plans • Other Plan Terminations – Departures From Canada • No Automatic Collapse • Collapse After Departure • Continue After Departure Copyright © 2014, Clarence Byrd Inc. 19 Canadian Tax Principles Registered Retirement Savings Plans • Other Plan Terminations – Departures From Life • Rollover To Spouse Or Infirm Child • Other Transfers – Involuntary At Age 71 Copyright © 2014, Clarence Byrd Inc. 20 Canadian Tax Principles Registered Retirement Savings Plans Spousal RRSPs • Benefits – Income Splitting – Additional Pension Credits Copyright © 2014, Clarence Byrd Inc. 21 Canadian Tax Principles Registered Retirement Savings Plans Spousal RRSPs • Attribution Rules – The Problem – The Rule For Withdrawals • In The Year Or Two Following - ITA 146(8.3) • Attributed To Contributor Copyright © 2014, Clarence Byrd Inc. 22 Canadian Tax Principles Registered Retirement Savings Plans Home Buyers’ Plan (HBP) • Qualifyin...
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