You can contribute to an RRSP by depositing cash, setting up automatic transfers, or moving existing investments into the account through your bank or brokerage. Your annual contribution room equals 18% of your previous year’s earned income, up to a maximum of $32,490 for 2025. Any unused room carries forward indefinitely, so if you haven’t maxed out in past years, you may have more room than you think.
Check Your Contribution Room First
Before putting money into your RRSP, confirm how much room you actually have. The CRA calculates your deduction limit each year and reports it on your latest Notice of Assessment. You can also find it by logging into your CRA My Account online, which shows your current limit in real time.
Your room is based on 18% of your earned income from the previous year, minus any pension adjustments if your employer runs a registered pension plan. If you earned $80,000 last year and have no pension adjustment, your new room for the current year would be $14,400. That amount stacks on top of any unused room from earlier years. Many Canadians who skipped contributions in their twenties or thirties discover they have tens of thousands in accumulated room.
Going over your limit triggers a penalty tax of 1% per month on the excess, though the CRA allows a $2,000 lifetime overcontribution buffer before that penalty kicks in. Checking your room before each contribution avoids this entirely.
Ways to Put Money In
Most people contribute in one of three ways: lump sum deposits, recurring automatic transfers, or in-kind transfers of investments they already own.
- Lump sum: You deposit a single amount, often near the contribution deadline or after receiving a bonus or tax refund. This is the simplest method, but it requires having cash on hand.
- Monthly automatic transfers: You set up a recurring transfer from your chequing account into your RRSP. Contributing $500 a month, for example, adds up to $6,000 over a year without requiring a large one-time outlay. Many financial institutions let you schedule this directly through online banking.
- In-kind transfers: If you hold stocks, bonds, or mutual funds in a non-registered (taxable) account, you can transfer them directly into your RRSP instead of selling them first and depositing cash. The CRA treats this as if you sold the investment at its fair market value on the transfer date, so you may owe capital gains tax for that year. But once inside the RRSP, those investments grow tax-deferred.
If you hold more than one RRSP, you can also transfer money between them. As long as your financial institution handles the transfer directly, no tax is withheld. You can even transfer up to $50,000 of accumulated earnings from an RESP into your RRSP if the RESP beneficiary doesn’t pursue post-secondary education, provided you have the contribution room.
The Contribution Deadline
RRSP contributions follow a 60-day rule: you have until 60 days after the calendar year ends to make contributions that count for the previous tax year. For the 2025 tax year, the deadline is March 2, 2026. Anything you contribute after that date applies to the 2026 tax year instead.
Contributions made between January 1 and the deadline can be claimed on either year’s return, giving you some flexibility. If you contribute in February 2026, for instance, you can deduct that amount on your 2025 return or save the deduction for 2026 if you expect to be in a higher tax bracket next year.
Claiming the Tax Deduction
Contributing to an RRSP and claiming the deduction are two separate steps. When you file your tax return, you report your contributions on Schedule 7 and choose how much to deduct. You don’t have to deduct everything you contributed in the same year.
This matters because your deduction saves you more money when your income is higher. If you’re in a lower tax bracket now but expect a raise or a high-income year soon, you can contribute today (locking in the tax-sheltered growth) and carry the deduction forward to a future return when it will offset tax at a higher marginal rate. There’s no time limit on carrying forward unused deductions.
Your financial institution will issue RRSP contribution receipts, which you should keep in case the CRA requests them. If you file electronically, you won’t submit the receipts with your return, but you’ll need them if your return is reviewed. Your Notice of Assessment will confirm your remaining deduction limit after each filing.
Spousal RRSP Contributions
You can contribute to an RRSP in your spouse’s or common-law partner’s name using your own contribution room. The contribution reduces your taxable income, not theirs. When your spouse eventually withdraws the money in retirement, it’s taxed as their income. This is a straightforward way to split retirement income between two people, especially when one partner earns significantly more than the other. The combined tax bill in retirement can be lower because both partners withdraw at lower marginal rates.
One rule to keep in mind: if your spouse withdraws from the spousal RRSP within three calendar years of your last contribution to it, the withdrawal is attributed back to you as income. After that three-year window, withdrawals are taxed in your spouse’s hands as intended.
The Age Limit
December 31 of the year you turn 71 is the last day you can contribute to your own RRSP. By that date, you must close the RRSP or convert it to a Registered Retirement Income Fund (RRIF), which pays you regular retirement income, or use the funds to purchase an annuity.
If you still have earned income after 71, you continue to generate new RRSP contribution room. You just can’t use it in your own plan. You can, however, contribute to a spousal RRSP if your spouse is 71 or younger, and still claim the deduction on your own return.
Getting Started Step by Step
If you don’t already have an RRSP, opening one is straightforward. Banks, credit unions, online brokerages, and robo-advisors all offer them. You’ll need your Social Insurance Number and standard identification. Once the account is open, you choose how the money is invested: savings deposits, GICs, mutual funds, ETFs, or individual stocks and bonds, depending on the provider.
After opening the account, check your CRA My Account for your exact contribution room. Set up your first deposit, whether that’s a one-time transfer or a monthly automatic contribution. Keep your contribution receipts, and when tax season arrives, report everything on Schedule 7 and decide how much to deduct. Your Notice of Assessment the following year will confirm your updated room going forward.