Calculating your Annual RSP Contribution Limit
Your annual RSP contribution limit is based on a three-step formula.

First, take 18% of your previous year’s "earned income," subject to the limits cited on the previous page. Earned income consists of more than your pay from work; check the list.

Second, subtract the Pension Adjustment factor (PA) that appears in box 52 of your T4 slip for the prior year. The PA reflects the value of benefits you accumulated in your employer’s registered pension plan or deferred profitsharing plan. Your PA will be zero if your employer has no such plans. You might also have a Past Service Pension Adjustment (PSPA) covering retroactive pension plan improvements. That reduces your RSP contribution room. Or, you might have a Pension Adjustment Reversal (PAR) if you’ve left a defined benefit pension plan before retirement age. A PAR allows you to contribute more to your RSP by restoring part of the RSP room you previously lost through the PA calculation.

Third, add any unused contribution room from as far back as 1991. That amount is on the Notice of Assessment for your most recent federal tax return. Or, call the Canada Customs and Revenue Agency’s computerized telephone service. The number is in your telephone directory’s blue pages.

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