Tax Savings from an RRSP

If you have an “RRSP Contribution Limit” as shown on your 2006 Notice of Assessment and you are a B.C. resident, here are three rules of thumb for 2007 RRSP deductions:

• If your taxable income is between $9,600 and $15,226, a $1,000 RRSP contribution would reduce your 2007 taxes by about $150.
• If your taxable income is between $15,226 and $37,178, a $1,000 RRSP contribution would reduce your 2007 taxes by $207 to $237.
• If your taxable income is between $37,179 and $74,357, a $1,000 RRSP contribution would reduce your 2007 taxes by $307 to $331.
• If your taxable income is between $74,358 and $120,887, a $1,000 RRSP contribution would reduce your 2007 taxes by $371 to $407.
• If your taxable income is over $120,888, a $1,000 RRSP contribution would reduce your 2007 taxes by about $430.

Look into the amount you can save with an RRSP contribution today.

Information for RRSP Tips is provided as a public service by the Chartered Accountants of British Columbia.