Is the RRSP contribution limit determined by Canadian income only?

Jamie Golombek, vice-president of taxation and estate planning at AIM Trimark Investments, has the answer.

Jamie Golombek 2 February, 2003 | 2:00PM

Dear Expert:

When calculating the retirement savings contribution limit (i.e., 18% of my previous year's earned income) does this relate only to Canadian income? What if in the prior year you were a non-resident for tax purposes?

Expert Opinion:

The definition of "earned income" includes only income that is earned for a period in the year throughout which you were resident in Canada. The RRSP contribution limit is based on 18 per cent of the prior year's earned income. Since you did not have "earned income" in 2002 because you were a non-resident of Canada, you will not generate any RRSP contribution room for 2003.

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Jamie Golombek

Jamie Golombek