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Local Enough?

Practice

Learn at your own pace, with an explanation after every answer. No score, no leaderboard – and not preparation for a citizenship test: just to know the country and your neighbours a little better.

Everyday life

What is a main tax advantage of contributing to a Registered Retirement Savings Plan (RRSP)?

  • A Withdrawals are always tax-free
  • ✓ Contributions can be deducted from your taxable income Your answer
  • C It doubles your contributions with government money
  • D It replaces the need to file a tax return

Correct!

RRSP contributions, within your limit, reduce your taxable income for the year, and the money grows tax-sheltered. Withdrawals are taxed later, usually in retirement.

Source: Canada Revenue Agency – RRSPs and related plans (canada.ca)

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