Discover how contributing to a Registered Retirement Savings Plan (RRSP) can lower your taxable income and potentially increase your tax refund this year.
See how contributing to your RRSP lowers your taxable income and generates a tax refund.
Combined Federal & Provincial
*Calculations are estimates using 2024/2025 blended tax rates and do not include all personal tax situations or deductions.
A Registered Retirement Savings Plan (RRSP) is a tax-advantaged account designed to help Canadians save for retirement. The primary tax benefit is that contributions you make are deductible from your taxable income.
When you earn income, you are taxed at a sliding scale known as tax brackets. The upper portion of your income falls into your "marginal tax bracket." When you contribute to an RRSP, you effectively subtract that contribution from your top income layer, yielding tax savings directly proportionate to your marginal tax rate.
You cannot contribute infinite amounts to an RRSP. Your RRSP deduction limit is generally 18% of your earned income from the previous year, up to a maximum limit set by the CRA each year (e.g., $31,560 for 2024, $32,490 for 2025). Any unused contribution room from previous years is carried forward. You can find your exact limit on your Notice of Assessment (NOA) from the Canada Revenue Agency.