August 2019 – Take care not to over contribute to your RRSP. Your current year’s RSP room is calculated and reported on CRA’s annual Notice of Assessment, which also includes RSP contribution room still available from prior years, and reflects previous contributions made but not yet deducted. Many are unclear on how RSP room is determined. The basic calculation is 18% of your prior year’s earned income, up to the current year’s maximum dollar limit, ($26,500 for 2019), plus any company sponsored pension plan contributions, and any pension adjustments or past service pension amounts reported on your T4 slips. ‘Earned income’ commonly includes salary, bonuses, gratuities, net business income, taxable support payments received, net rental income, CPP disability pensions, spousal and child support income. Employment expenses, net business losses, deductible support payments made, net rental losses, and union dues then reduce ‘earned income’.