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Applying spousal RRSP contribution to Home buyers plan

#1

I have a client who has paid into his wife’s RRSP plan (she is the only annuitant on plan).
How do I apply this amount to her Home buyers plan Line 9 on RRSP worksheet? It does not show up as amounts available on her just on his. I can override by reducing the amount he available to him and adding to her line 9 but wanted to check first.

I know on CRA’s website there is information that states" Not all contributions you make to your RRSP(s), PRPP or SPP in the repayment year or in the first 60 days of the year after can be designated as a repayment under the HBP. You cannot designate contributions that: you make to your spouse’s or common-law partner’s RRSP(s) or SPP (or that he or she makes to your RRSP(s)"

I presume this means that contributions he has made to his Spouses RRSp can not be used on his HBP but can still be used on hers?

#2

No, if she has a Homebuyers Plan she needs to make the repayment herself, or else add the income annually.

#3

Okay that’s what I had determined at first . They have been paying back into their HBP for the last 12 years with the Spousal contributor RRSP’s.

The bank told them this was how to set it up ( her as annuitant and HBP plan owner) with him contributing back into her RRSP plan and using the amounts towards her HBP.

I was unsure it was correct. They have been re-assessed by the CRA and this has not been reviewed in last 12 years?

#4
  • Getting their professional tax advice from some unqualified person at a bank was a very silly decision on their part, as it is not correct :frowning: !

“How do I apply this amount to her Home buyers plan Line 9 on RRSP
worksheet? It does not show up as amounts available on her just on his”

  • The wife has not made ANY RRSP contributions, therefore she has NONE to allocate to anything…
#5

That’s quite odd Kevin, If she has a Homebuyer’s Statement on her Notice of Assessment then she either needs to make the payments or add to her income each year. Of course, if he is making spousal RRSP contributions then technically, the amounts she has not repaid each year would attribute back to his return (spousal withdrawal rules).

The CRA doesn’t normally “re-assess” for this. They actually do it on the initial assessment, meaning if you did not repay your HBP for the year they simply add the income to your return and explain it on the NoA. Perhaps the CRA have been adding this to her income every year on each Notice of Assessment?

If she doesn’t have a Homebuyer’s Statement on her last Notice of Assessment then that would explain why the CRA has not adjusted her returns for the last 12 years.

#6

Sorry to clarify, she has been reassessed for other issues not the HBP. Her notice of assessment shows the reducing balance on the HBP.

They moved into the area this year so new client for me. He did his own taxes and somehow allocated to her HBP, his contributions to her RRSP plan. It was odd that this was how the bank set it up in the first place. She had no income for the 12 years and no way to allocate back to the HBP. She had the funds in her RRSP plan he had paid in, she had paid nothing in. He could have taken the HBP out in his name as he did not have a HBP at all? The end result is they have only 2 years left to pay back, she is earning now and I have instructed that the RRSP must be paid into her plan using her RRSP contributions.