Dale Jackson

Personal Finance Columnist, Payback Time

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Employers have until the end of February to send out T4 statements. If you already have yours take note of your 2016 income and remember this: every dollar you can’t contribute to your registered retirement savings plan is a dollar you will be taxed on at your highest level.

Coming up with the cash for an RRSP contribution can be challenging, but one untapped resource could be your tax-free savings account. There is no penalty for withdrawing from your TFSA but any investments have to be turned into cash before going into your RRSP.

To ensure you have the contribution space in your RRSP look at last year’s statement from the Canada Revenue Agency.

Remember, RRSP contributions are fully taxed when they are withdrawn (ideally in retirement), but they will generate an immediate tax refund if you contribute before the March 1 midnight deadline.

If you have not maxed out your TFSA limit, you can put the refund right back in your TFSA. If you maxed it out this year, you must wait until 2018 to recontribute – unless you have space from previous years.

Here’s a breakdown of the annual contribution limits from the beginning: