If you would like to claim your RRSP contribution(s) for a given tax year, you need to make the contribution(s) before the first 60 days of the following year. So for example, if you wanted to ensure you could claim an RRSP contribution for the 2007 tax year, it must be in no later than February 29th, 2008. This is the RRSP Contribution Deadline that you will hear about in the media at the beginning of every year.
February 29th represents the 60th day of 2008. (Note that 2008 is a leap year – normally the deadline will be March 1st in non-leap years.)
If you wait until the 61st day or later to make your contribution, then you lose the ability to claim the contribution for the preceding tax year – the earliest you would be able to claim those contributions would be for that current tax year.
Many people wait until the last minute to make a lump sum RRSP contribution, but more and more Canadians are spreading out their savings by making contributions on a monthly basis either on their own, or through payroll deductions to a Group RRSP at work. Further, for those that make lump sum contributions in February, many use RRSP loans in order to do so. The deadline causes a scramble because larger contributions allow for larger tax refunds a few months later come tax return time. The promise of these tax savings helps lessen the burden of making the larger contributions.
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