What to do about an RRSP Overcontribution
Question: I have a question concerning overcontributions to my RRSP. I’m fully caught up as of Feb 29 2000. On March 7, I contributed $20,000 into my RRSP trading account and will claim the maximum of $13,500 on next year’s return (my income allows that). The fact that my RRSP account will show a $6,500 overcontribution, even though I haven’t claimed it for tax purposes concerns me. I’m well aware of the $2,000 overcontribution limit, but I’m wondering on what basis is that $2,000 calculated: i) what I report on my tax return, or ii) what my brokerage firm reports to RevCan?
If, for example, I withdraw some or all of that overcontribution, will RevCan consider that a taxable withdrawal, or will they see that I have $6,500 in my RRSP account that isn’t really eligible, since I haven’t claimed it as a contribution.