| 24(1) | 5-901808 |
| D. Duff | |
| (613) 957-3498 |
19(1)
December 19, 1990
Dear Sirs:
Re: RRSP Contribution Limits
This is in response to your letter of August 3, 1990 requesting our opinion on RRSP contribution limits for 1990 for individuals who have ceased to be members of a pension plan in the year.
We can confirm that your interpretation of paragraph 146(5)(a) of the Income Tax Act (the "Act") as it applies to 1990 is correct. For 1989 and 1990, subparagraph 146(5)(a)(i) applies to individuals who were employed in the year and, as a consequence thereof, are entitled to benefits under a pension plan. A refund of an employee's contributions would be considered to be pension benefits for purposes of subparagraph 56(1)(a)(i). Therefore, a former employee receiving, or entitled to receive, such amounts would be limited by 146(5)(a)(i).
Individuals in this situation who have contributed $7,500 to a RRSP will have an over contribution and should follow the normal procedures to have it refunded.
We trust that these comments are satisfactory to you.
Yours truly,
for DirectorFinancial Industries DivisionRulings Directorate