Étienne opens his notice of assessment before making an RRSP contribution. One line shows a deduction limit. Another reflects contributions he already made but has not deducted. He was about to use the larger number as permission for a new deposit.
The distinction is simple: a deduction is claimed on a tax return; a contribution is money already placed in the plan.
Start with the latest assessed information
Étienne uses his latest assessment, reassessment or CRA account information. A later reassessment can change the figures, so an old screenshot is not enough when his return has since been corrected.
RRSP room is not just a percentage of this month's salary. The calculation involves prior-year earned income, annual limits, pension adjustments and unused room carried forward. Contributions to a spouse's RRSP generally use the contributor's room too.
Account for money already in the plan
Suppose Étienne's deduction limit is $12,000 and he has $3,000 of previously reported unused contributions. Those contributions may support a future deduction, but they are not fresh space for another deposit. In this simplified example, $9,000 remains before considering any further contributions or adjustments.
He then checks contributions made since the information was prepared, including a workplace group RRSP. If another $2,000 has gone in, his working balance falls to $7,000. This reconciliation does not replace his actual CRA calculation.
Keep contribution and deduction decisions separate
An eligible contribution can sometimes be deducted in a later year. Deferring the deduction does not undo the contribution or create more room now.
Étienne keeps receipts from all institutions and a dated running total. He records first-60-days contributions carefully because their reporting period can be confusing. Before depositing more, he resolves any gap between his ledger and the assessed information rather than assuming the bank will know his complete history.