RRSPs RRIFs and TFSAs -> Final RRSP Contribution at Age 71
RRSP Excess Contribution at Age 71
If you have earned income in the year you turn 71, which generates RRSP contribution room for the following year, you can only use this room to contribute to the RRSP of a younger spouse or by making an excess contribution to your own RRSP in the year you turn 71. This is because your RRSP must be converted to a RRIF by the end of the year in which you turn 71.
Let's say you earn enough in 2018, the year you turn 71, to generate $10,000 of contribution room for 2019. If you contribute $10,000 to your RRSP in December of 2018, you will pay a penalty of $80 (1% x ($10,000-$2,000)) for the one month end of the excess contribution. Excess contributions over $2,000 are subject to the penalty. As of January 1, 2019, it will no longer be an excess contribution, and the $10,000 can be deducted on your 2019 tax return. Note that most brokerages or financial institutions will automatically convert your RRSP to a RRIF in the year you turn 71, if you don't arrange this for yourself by early November. So if you plan to make a December contribution, talk to your brokerage ahead of time. If they convert your account to a RRIF, they should allow the RRSP to be temporarily reactivated to make a December contribution.
If you have earned income and thus contribution room after age 71, you can make contributions to the RRSP of a spouse who is 71 or younger. However, see the attribution rules regarding subsequent withdrawals made by the spouse from the RRSP or a RRIF.
See also:
Tax Tip: It may be advantageous to over-contribute to your RRSP in December of the year you turn 71.
Revised: October 26, 2023