Unused RRSP contribution room by 401k contribution

[maskdoll]

Since CRA is very slow in processing and reviewing my tax return, I haven't received a NOA for quite sometime. So I need to ask this lovely forum to plan my next year RRSP contribution.

I searched history post on this topic and I am aware that ONLY 401K Employer's contribution (not employee contribution) deducts the next year's RRSP contribution room. But I am confused by the 401K on the unused RRSP room.

For example, I have a total of RRSP contribution room of 100K. The past year, I contributed RRSP 50K. 401K employee contribution: 30K (in CAD), employer contribution: 20K (in CAD).

1) I know my income was reduced by RRSP contrib + 401k employee contrib. But what does my next year's RRSP contribution room look like? Existing room (100k) - last year's RRSP contrib (50k) - last year 401k employee contrib(30k) + 31560 (RRSP limit for 2024) - 401k employer contrib (20K)? I thought 401k employee contrib should be out of the formula, but my CPA didn't think so.

2) If my total RRSP contrib room for next year is 20K, my 401k contrib this year is already over 20K, can I still contribute to RRSP? Will I get penalty for over contribution?

Many thanks, lovely folks.

[kundewayne]

maskdoll wrote:
> Since CRA is very slow in processing and reviewing my tax return, I haven't
> received a NOA for quite sometime. So I need to ask this lovely forum to
> plan my next year RRSP contribution.
>
> I searched history post on this topic and I am aware that ONLY 401K
> Employer's contribution (not employee contribution) deducts the next year's
> RRSP contribution room. But I am confused by the 401K on the unused RRSP
> room.
>
> For example, I have a total of RRSP contribution room of 100K. The past
> year, I contributed RRSP 50K. 401K employee contribution: 30K (in CAD),
> employer contribution: 20K (in CAD).
>
> 1) I know my income was reduced by RRSP contrib + 401k employee contrib.
> But what does my next year's RRSP contribution room look like? Existing
> room (100k) - last year's RRSP contrib (50k) - last year 401k employee
> contrib(30k) + 31560 (RRSP limit for 2024) - 401k employer contrib (20K)? I
> thought 401k employee contrib should be out of the formula, but my CPA
> didn't think so.
>
> 2) If my total RRSP contrib room for next year is 20K, my 401k contrib this
> year is already over 20K, can I still contribute to RRSP? Will I get
> penalty for over contribution?
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>
> Many thanks, lovely folks.

You seem to be in a complicated tax scenario! 401(k) company contributions don't affect RRSP contribution room, but employee contributions are confusing. For your second query, exceeding your RRSP contribution maximum may result in penalties. Discuss your case with your CPA. Contact CRA for advice after receiving your NOA. Inform us of your progress!

[maskdoll]

CRA is still reviewing my tax file.
Anyone had any insight on the RRSP contribution room affected by 401K?

[maskdoll]

CRA is still reviewing my tax file.

Anyone can share some insight on RRSP contribution room affected by 401k?