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February 14, 2012

Deadline approaching for 2011 RRSP contributions

Canadians should be advised that February 29, 2012 is the last day you can contribute to a RRSP for the 2011 tax year.

According to the Canada Revenue Agency web site, "Registered Retirement Savings Plans (RRSPs) are one of the most popular investment vehicles for Canadians. According to Statistics Canada, 6 out of 10 Canadian families held RRSPs in 2005."

The most recent information about your RRSP deduction limit is available through My Account at

View our list of important dates and deadlines for 2012.

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December 1, 2007

Tax Alert Warning: Investing in schemes that promise you tax-free withdrawals from RRSPs and RRIFs could result in you losing your retirement savings

According to a tax alert issued by the Canada Revenue Agency, the CRA is finding an increasing number of questionable Registered Retirement Savings Plan (RRSP) and Registered Retirement Income Fund (RRIF) tax-free withdrawal schemes. As such, the CRA is warning Canadians that "investing in such schemes could result in you losing your entire retirement savings to unscrupulous promoters and in a reassessment of your tax returns."

Stats and Facts
- To date, the CRA has reassessed over 3,100 taxpayers who participated in these schemes resulting in additional taxable income of approximately $144 million.
- Audits of another 1,800 taxpayers with $84 million in RRSP and RRIF investments are currently underway.
- Audits on other arrangements are about to begin.

Questionable RRSP/RRIF schemes
Taxpayers should avoid schemes that promise the following:

- Withdrawal of funds from an RRSP or RRIF without paying tax. Promoters often promise to return part of the taxpayer's investment by offshore debit or credit cards, offshore bank accounts, or loan-back arrangements;
- Immediate access to assets in “locked-in” RRSPs or RRIFs;
- Income tax deductions of three or more times the amount invested in an RRSP;
- Unrealistic returns on investments.

For more information on this tax alert, please see the CRA web site at:

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January 15, 2007

CRA Tax tip: Take it to the limit!

The Canada Revenue Agency is reminding all eligible Canadians that March 1, 2007 is the deadline for making a contribution to a registered retirement savings plan (RRSP) for the 2006 tax year. For more information on this tax tip, see the CRA web site at:

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March 1, 2005

RRSP Pointers

A reminder that today, March 1, 2005, is the deadline for making a deductible contribution to your Registered Retirement Savings Plan (RRSP) for the 2004 taxation year.

Please note that contributions made in the first 60 days after the calendar year must be reported on your personal tax return for the previous calendar year (i.e. Jan 1 - Mar 1, 2005 contributions must be reported on your 2004 T1). The reason this is more critical then ever is that the Canada Revenue Agency (CRA) is implementing a "matching program" much like the system they use for the various T-slips. If the total contributions you report, in the remainder of the calendar year and in the first 60 days after the calendar year respectively, do not agree with the information CRA has on file (from the various issuing financial institutions), then you can expect an inquiry, and possibly even an audit, by CRA. For example, if you contributed $5,000 on February 28, 2005 and $10,000 between March 2 and December 31, 2005, you cannot report $15,000 of contributions in the remainder of 2005 as this will not agree with the $10,000 CRA has on record.

So, it's very important you report the contributions in the correct taxation year, regardless of whether you can, or want, to take the RRSP deduction in that year.

Key Strategies
I encourage you to read the February 8, 2005 article "RRSPs: Key Strategies" written by Daniel Saikaley of CIBC Wood Gundy. This article, which can be accessed on this website, provides some excellent RRSP tips.

Caren MacLeod
Scott Rankin & Gardiner

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February 28, 2005

Reminder: RRSP Deadline March 1, 2005

A reminder that March 1st, 2005 is the deadline for making a deductible contribution to your Registered Retirment Savings Plan (RRSP) for the 2004 tax year. Contributions made after March 1, 2005 may be applied to your 2005 tax year contribution limit.

If you do not know your RRSP deduction limit for 2004, the amount is shown on your Notice of Assessment or Notice of Reassessment for the previous tax year. The Canada Revenue Agency also allows you to see this amount using its online "My Account" feature available on the CRA Web site or you can call the Tax Information Phone Service (T.I.P.S.) at 1-800-267-6999.

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February 22, 2005

Turbo-Charge Your Retirement Savings With An IPP

Retirement Planning

Interest in Individual Pension Plans (IPP) has been growing. That's because an IPP may be able to provide higher pension benefits for small business owners and others who meet specific criteria.

An IPP is an employer-sponsored, defined benefit pension plan. This means that an actuary determines the level of contributions that the employer must make to ensure a stable pension income stream for the employee. Similar to an RRSP, contributions accumulate and compound within the plan sheltered from taxes. At retirement, taxes are payable on amounts withdrawn. With an IPP, there is the potential to save more funds for retirement because of higher contribution limits than RRSPs. It's important to note that funds invested in an IPP cannot be withdrawn until retirement or plan termination.

IPPs are best suited for individuals over 45 years of age and earning over $100,000 per year. You should currently be contributing the maximum allowable to your RRSP and have at least a five-year time horizon until retirement. Additionally, an employer must be willing to set up, administer and fund the IPP.

Most financial institutions that offer IPPs will provide you with a variety of eligible investments. Like RRSPs, investments within your IPP are subject to foreign content restrictions. In addition, all investments must comply with applicable pension legislation investment guidelines. An IPP strategy should be considered within the context of a comprehensive financial and estate plan. To learn more about IPPs and how they may fit into your overall financial plan, contact a professional investment advisor.

Daniel Saikaley, CA CFP EPC
Investment Advisor
CIBC Wood Gundy

The information contained herein is considered accurate at the time of posting. CIBC and CIBC World Markets Inc. reserve the right to change any of it without prior notice. It is for general information purposes only. Clients are advised to seek advice regarding their particular circumstances from their personal tax advisor.

Given the complexities involved, specialized tax and pension advice must be sought to ensure an IPP is appropriate to individual situations. Also, an IPP strategy must be considered within the context of a comprehensive financial and estate plan.

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February 8, 2005

RRSPs: Key Strategies

RRSP season is here and if you are like many investors, you probably leave it to the last minute to make your annual contribution. To get you thinking about this year’s RRSP contribution, below are some excellent RSP tips every investor should remember.

Develop a fully balanced portfolio:
Consider the full range of investments available, along with the risk and return ratio of each. With the help of your Investment Advisor, develop a balanced, diversified portfolio of RRSP assets.

Consider a spousal RRSP:
You get the tax savings but the money compounds tax-free in your spouse’s name for retirement. This could mean two lower tax brackets at retirement instead of one higher one. The goal here is to equalize income in retirement. You can make spousal contributions even if you contribute to your own plan, but the total amount must not exceed your own maximum allowable contribution. Keep in mind that although the assets belong to your spouse in this case, you should watch out for the attribution rules.

Take advantage of the foreign content allowance:
Many Canadians are not aware that you can invest up to 30 percent of your RRSP’s book value in certain non-Canadian securities. International investing can build greater stability through diversification, and offers other growth opportunities.

Consolidate your RRSP holdings for easier record keeping – and better growth:
There’s no limit to the number of RRSPs you can own. But, review your holdings periodically to make sure you’re getting the most from them. And remember that when you mature your RRSPs at retirement, it’s easier to move your savings into a Registered Retirement Income Fund from one or two sources than from several.

Understand RRSP over-contribution limits:
All RRSP holders 18 years of age or older now have a lifetime over-contribution allowance of $2,000. Beyond that, a penalty of one percent per month is payable on the excess contribution.

Rely on professional advice:
Professional Investment Advisors can help you set your goals and objectives. They will work with you to build an investment plan around these objectives and determine the right investment choices for your RRSP.

Avoid taking a short-term view:
By taking a long-term approach to investing, volatility becomes less of a concern and temporary downturns in the market can become buying opportunities. Remember – RRSPs are intended to be long-term investments.

Daniel Saikaley, CA CFP EPC
Investment Advisor
CIBC Wood Gundy
Visit my website at

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January 27, 2005

RRSP Checklist

Financial Planning: Your RRSP Checklist

The following is a handy last-minute checklist of things to remember during RRSP season.

Find Out How Much Contribution Room You Have
One quick way to find out is to look at your Notice of Assessment received from the Canada Revenue Agency last year. Pay particular attention to any RRSP contribution room you may have from previous years. Obviously, you'll want to tackle unused contribution room now if you can; with an estimated $176-billion in unused contribution room outstanding, I expect many of us have unused contribution room.

Explore Your Contribution Options
There are many different ways to structure your contribution. When making your contribution this year, think about how you're making it. Whatever you decide, the trick is to think about how you'll be making your contribution ahead of time so as not to make it an undue strain on your February finances.

Take Advantage of Foreign Content
Every RRSP investor should review the foreign content in his or her RRSP portfolio. If you haven't yet brought your foreign content up to the maximum limit, you may want to consider an increase. Other considerations include incorporating the 100 percent RRSP eligible foreign mutual funds into your RRSP, which allow investors to go beyond the foreign content restriction imposed by Canada Revenue Agency (CRA). If you are unfamiliar with these funds, I would be happy to speak to you about these opportunities for your registered plans.

Don't "Park" Your Money
Speaking of last-minute contributions, waiting until late February to contribute can often mean waiting even longer to decide where to put that contribution. While late is better than never, once you've made the deadline, don't let your money sit around. If you don't have a specific investment in mind when you contribute, don't worry – there are plenty of short-term investments available. But, make a commitment to find a place for your money as soon as you can. In real life, there is no such thing as “Free Parking”. The growth you stand to lose by keeping your contribution in cash can be quite significant.

Think About Withdrawals
If you're nearing retirement, you'll want to think about how to time your RRSP withdrawals. For those turning 69 this year, you need to choose a maturity option for your RRSP before December 31. In most cases this will be a RRIF. For those planning on withdrawing money before age 69, think about when to withdraw it. RRSP withdrawals must be included on the current year's taxable income. When you take money out can make a big difference to the overall tax you pay.

Have a Plan for Your Refund
When your refund comes in May or June, incorporate it into your financial plan. That may mean contributing to your RRSP, subject to your overall limit, but it doesn't have to. Refunds are great for paying down credit card debt, lump-sum mortgage payments, making other investments, or accomplishing some other financial goal.

Get Some Help!
The most important tip I can give. Your RRSP is one of the fundamental pillars of your overall financial plan; as such, it deserves professional attention. Your Investment Advisor is someone you should trust, and preferably one skilled in constructing retirement plans. Consult with him or her when making your contribution. When it comes to retirement a little professional help can go a long way.

For a complimentary copy of our Retirement Savings Guide, contact my office.

Daniel Saikaley, CA CFP EPC
Investment Advisor
CIBC Wood Gundy
Visit my website at

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