# Tax Newbie Question



## Rago (Feb 27, 2017)

Hello there,
I am doing my 2016 Taxes, the company I worked for was sold and I got a severance package on Dec 2016, this severance amount went directly to my RRSP so I get no tax deductions (at least that was the idea).
Now, when I'm doing my taxes I see this severance is in my T4 (Box 67) and RL1 form (box O Other Revenues).
The problem I seem to have is that when I enter this value, my final tax review shows that I own instead of having a refund as I usually get every year, when I remove the amount just to check, I see the average refund I get.
So I guess I need to find out where I enter that I actually didn't touch that money but send it to my RRSP.

Any help will be greatly appreciated

Thanks


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## OnlyMyOpinion (Sep 1, 2013)

I am not a tax expert, but box 67 is the non-eligible portion of a retiring allowance. As I understand it, unless you were an employee before 1996 it is unlikely any part is eligible. So I suspect it was a non-eligible amount that was transferred to your RRSP. This is allowed to the extent that you have contribution room available in your RRSP. I think that means you should get an RRSP contribution slip for that amount (from whoever you have your RRSP with) and you could claim that amount on your taxes, offsetting box 67.
But again, I am not a tax expert.
Poke around some searches on the CRA website and see if this makes sense: http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/rrsp-reer/trnsfrrng/rtrng-eng.html


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## cashinstinct (Apr 4, 2009)

You should have a RRSP contribution amount on your T4 / RL1 form.

Do you see that contribution reported on your Line 208 – RRSP and PRPP deduction - ARC (Federal) ?


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## OnlyMyOpinion (Sep 1, 2013)

So along the lines of: 

Line 15 – Transfers
You may have reported income on line 115, 129, or 130 of your income tax and benefit return for 2016. If you contributed certain types of this income to your own RRSP on or before March 1, 2017, you can deduct this contribution, called a transfer, in addition to any RRSP contribution you make based on your RRSP deduction limit for 2016.
For example, if you received a retiring allowance (severance pay) in 2016, you would report it on line 130 of your income tax and benefit return. You can contribute to your RRSP up to *the eligible part* of that income (box 66 of your T4 slips or box 47 of your T3 slips) and deduct it as a transfer. Include the amounts you transfer on lines 2 or 3 and 14 of Schedule 7.
For more information about amounts you can transfer, see Chapter 6 – Transfers to registered plans or funds and annuities.

http://www.cra-arc.gc.ca/E/pub/tg/t4040/t4040-e.html#line14


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## Rago (Feb 27, 2017)

Thank you guys for your replies

I got my RRSP contribution receipt from the institution I have the RRSP with, I guess I would claim this amount in my taxes using Schedule 7 as you guys pointed out. I'm using ufile/netfile to do my Taxes and I can't find Schedule 7 anywhere
I should have mentioned that I started working on 2003 and actually I never had RRSP until I decided to open it recently on Dec 2016.
I don't see RRSP contribution on my T4/RL1 neither on line 208
I see income reported on line 130 (my severance amount).
So, if I understood correctly I need to fill schedule 7 to claim this RRSP amount?
if so could somebody point me to the right direction about how to do this using ufile/netfile?

Once again thank you very much for taking the time to reply

Regards,


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## OnlyMyOpinion (Sep 1, 2013)

I don't know ufile, but if you go to http://www.ufile.ca/help/ask-ufile and type in _schedule 7_ and click search, a description comes up describing data entry. Does it resolve your issue?


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## Rago (Feb 27, 2017)

Hello "OnlyMyOpinion"
I checked the link you posted and gave me some information:
"Following a dismissal or retirement, you received an RL-1 slip with an amount in Box O and code RJ.
You also received a T4 slip, but the amount of your dismissal or retirement is included in Box 14 of the T4 slip and no amount appears in Boxes 66 and/or 67.
To enter this allowance, follow this procedure:...."

However as you can see it talks about the case there I DON'T have information on Box 67 and in my case I do

I followed the instructions anyway to enter the RL-1 information for box O and code RJ, but still when I check the final review is taxing the severance amount.

I will keep looking 

Thank for your input

if you or anyone else come up with another idea I will be "listening"

Thanks


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## OhGreatGuru (May 24, 2009)

I think it won't appear on your T4. By paying it to your RRSP they didn't have to retain withholding tax. But it is still taxable income unless you confirm the RRSP deduction by completing Schedule 7. Some retiring allowances are eligible for special RRSP room over and above your current limit. If that were the case the eligible portion would be identified on the T4. But I'm pretty sure you have to have service before 1996 for part of the retiring allowance to be eligible.

PS. This contribution comes off your current RRSP room, so you better check that you haven't over contributed.


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## RussT (Jul 11, 2016)

To get Schedule 7 in Ufile go to the Interview tab, Interview Setup section, Common Tax Deductions group and check the RRSP box. Does that help?


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## Rago (Feb 27, 2017)

All,
What I did is, while in ufile I used help/search and type schedule 7, it gave me a link and when clicking on it, it was added automatically to the tax form, from there I was able to fill in the info and that solved my problem.

Thank you very much to all of you for helping me out

Regards


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