Your RRSP contribution limit after 71
I can understand your confusion, Bob, because you and your wife have converted your RRSPs to registered retirement income funds (RRIFs). An RRSP account holder needs to do this by no later than December 31 of the year they turn 71.
There’s a spot on your NOA and in your CRA online account to report your RRSP room, so the CRA will provide your RRSP deduction limit, even though you’re no longer contributing to your RRSPs. If you are older than 71, you generally cannot do anything with your RRSP room. That said, there may be an exception.
Contributing to spousal RRSPs
If your spouse is age 71 or younger, he or she can open a spousal RRSP. A spousal RRSP is an account that is owned by one spouse—typically the one with lower income or who is younger—and contributed to by the other spouse, who typically is older or has a higher income.
You can make RRSP contributions when you’re older than 71, as long as you’re contributing to a spousal RRSP for a younger spouse. When doing so, you use your own RRSP room and claim the deduction on your own tax return. The spousal RRSP account holder takes the withdrawals in the future.
Can you have an RRSP and a RRIF at the same time?
Even if you have already converted your RRSP to a RRIF, you can still make RRSP contributions. This is because you can have unlimited RRSPs and RRIFs, and when you convert an RRSP to a RRIF, you only do so for that specific account. You do not have to convert all of your accounts at the same time.
You can even transfer your RRIF funds back to an RRSP and stop RRIF withdrawals, if you are 71 or younger. Although this is uncommon, it is technically allowed.
The only time that you might want to contribute to an RRSP after converting your RRSPs to RRIFs is if you had a spike in income or cash to contribute and you wanted to claim an RRSP deduction.
Unused RRSP contributions
Interestingly, you can contribute to an RRSP up until the end of the year you turn 71 and carry forward the deduction. These unused RRSP contributions are available to deduct in the future with no age limitations.
