An excess contribution is calculated as the total of all of your undeducted RRSP contributions, minus your current RRSP deduction limit and minus an allowable over-contribution of $2,000. Excess contributions are subject to a 1 per cent per month penalty until they are withdrawn. With prior Canada Revenue Agency approval, you can generally withdraw any excess contributions without taxation within certain time limits.
Keep in mind that the penalty situations are complex. Consult a Chartered Accountant for advice if you are in this situation.
Information for RRSP Tips is provided as a public service by
the Chartered Accountants of British Columbia.