Guides › RRSP Limit 2026 and 2027: The 18% Rule Explained
RRSP Limit 2026 and 2027: The 18% Rule Explained
General information only. Not financial, tax or investment advice. This site is independent and is not the Canada Revenue Agency (CRA). Check canada.ca and your CRA My Account for your own figures. Last checked against CRA pages: October 17, 2026. Examples use made-up numbers. No advertising or affiliate links appear on this page.
2027 figure: CRA's limits table lists $35,390 for 2027. Treat it as expected and re-check canada.ca on January 1, 2027. Your own limit is on your CRA notice of assessment, not on this page.
Short answer: Per CRA, your RRSP deduction limit generally equals your unused room from the previous year, plus the lesser of 18% of last year's earned income and the annual RRSP dollar limit, reduced by your pension adjustment (PA), plus any pension adjustment reversal, minus any net past service pension adjustment.
Annual dollar limits (CRA table)
| Tax year | RRSP dollar limit |
|---|---|
| 2025 | $32,490 |
| 2026 | $33,810 |
| 2027 | $35,390 |
The 2026 limit applies to the room you add for 2026, which is based on your 2025 earned income.
Made-up examples (new room only; ignores unused room)
| 2025 earned income | 18% | Lesser of 18% and $33,810 | Less PA | New 2026 room |
|---|---|---|---|---|
| $60,000 | $10,800 | $10,800 | $0 | $10,800 |
| $90,000 | $16,200 | $16,200 | $3,000 | $13,200 |
| $250,000 | $45,000 | $33,810 | $0 | $33,810 |
Your CRA-calculated figure includes unused room from earlier years and other adjustments.
Key terms
- Earned income has a specific tax definition (CRA); it is not the same as total income. We have not summarized it here.
- Pension adjustment (PA): shown on T4 slips if you belong to an employer pension plan.
- Unused room carries forward.
Contributions you cannot deduct (CRA)
Administration fees, brokerage fees to buy and sell in a trusteed RRSP, interest on money borrowed to contribute, and capital losses within your RRSP.
FAQ
Is the limit what I can contribute? Your contribution room is your deduction limit; contributing over it by more than $2,000 triggers tax; see over-contribution penalty.
Why are there two numbers? One is the dollar cap per year; the other is your personal limit.
What we could not verify
- CRA's definition details for earned income in your situation (see Guide T4040).
- Whether the 2027 dollar limit changes before it applies.
Sources (official)
- CRA, MP, DB, RRSP, DPSP, ALDA, TFSA limits, YMPE and the YAMPE — https://www.canada.ca/en/revenue-agency/services/tax/registered-plans-administrators/pspa/mp-rrsp-dpsp-tfsa-limits-ympe.html (read October 17, 2026)
- CRA, How contributions affect your RRSP deduction limit — https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/rrsps-related-plans/contributing-a-rrsp-prpp/contributions-affect-your-rrsp-prpp-deduction-limit.html (read October 17, 2026; figures shown are for 2025)
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Not tax or financial advice. See the disclosure.