The Canada Revenue Agency's limits table sets the RRSP dollar limit for 2027 at $35,390, up from $33,810 for 2026. The figure is already final: an RRSP dollar limit always equals the previous year's money purchase limit, and the 2026 money purchase limit was set at $35,390.
For owner-managers the date that matters is not January 1, 2027. It is December 31, 2026. Your 2027 RRSP room is built from your 2026 earned income, so the salary-versus-dividend mix you settle on in the last quarter of this year decides how much of that $35,390 you can actually use.
What changed and who it affects
- The change: The annual RRSP dollar limit rises by $1,580, from $33,810 (2026) to $35,390 (2027).
- When it applies: To RRSP deduction room for the 2027 tax year.
- Who it affects: Anyone whose 2026 earned income is high enough that 18% of it exceeds $33,810. Below that income level, the 18% calculation, not the dollar limit, sets your room, and the increase changes nothing for you.
Source: CRA — MP, DB, RRSP, DPSP, ALDA, TFSA limits, YMPE and the YAMPE and CRA — What's new, savings and pension plan administration.
RRSP limit 2027 and prior years
| Tax year | RRSP dollar limit | Change from prior year | Earned income needed in the previous year to reach it (18%) |
|---|---|---|---|
| 2024 | $31,560 | — | $175,334 (2023 earned income) |
| 2025 | $32,490 | +$930 | $180,500 (2024 earned income) |
| 2026 | $33,810 | +$1,320 | $187,834 (2025 earned income) |
| 2027 | $35,390 | +$1,580 | $196,612 (2026 earned income) |
The last column is the dollar limit divided by 18%, rounded up to the next dollar. It is the earned income at which the percentage calculation stops being the binding cap.
How your actual 2027 RRSP room is calculated
The $35,390 is a ceiling, not your number. The CRA works out your RRSP deduction limit as:
- the lesser of 18% of your earned income for the previous year and the annual RRSP dollar limit,
- minus your pension adjustment (PA) from the previous year and any prescribed amount,
- plus any pension adjustment reversal (PAR),
- plus unused deduction room carried forward from earlier years.
Your exact figure appears on your Notice of Assessment and in CRA My Account once your prior-year return is assessed. Unused room carries forward indefinitely, so a year in which you contribute nothing is not lost room.
Source: CRA — How contributions affect your RRSP deduction limit.
Why salary versus dividends decides your 2027 RRSP limit
Earned income for RRSP purposes is built mainly from employment income and self-employment business income, plus a short list of other items in Chart 3 of the CRA's RRSP guide (T4040), less employment expenses and business or rental losses. Dividends are not on that list. An owner-manager who pays themselves entirely in dividends from their corporation creates no new RRSP room, however large the dividends are.
That makes the 2026 compensation plan the real RRSP decision:
- Full 2027 room needs at least $196,612 of 2026 earned income, for example T4 salary from your corporation.
- A smaller salary earns proportionally less room: a $100,000 salary in 2026 earns $18,000 of 2027 room (18%), before any pension adjustment.
- All dividends earns no 2027 room from that income. Existing carry-forward room is unaffected.
Salary has costs that dividends do not: it attracts CPP contributions (on earnings up to the 2026 YMPE of $74,600, and CPP2 up to the YAMPE of $85,000), it has to run through payroll with source deductions remitted to the CRA, and it moves income out of the corporation, which changes how much of your profit is taxed at the small business rate. Whether the RRSP room is worth those costs depends on your full picture, which is why it belongs in the year-end compensation review rather than being decided in February. See our CPP, CPP2 and EI explainer and the small business deduction limit guide for the corporate side.
Source: CRA — RRSPs and Other Registered Plans for Retirement (T4040).
Edge cases owner-managers get wrong
Bonuses that straddle the calendar year. Employment income counts in the year it is received, not the year your corporation accrues it. A bonus your corporation accrues in a fiscal year ending November 30, 2026 but pays in February 2027 is 2027 employment income, so it builds 2028 RRSP room, not 2027 room. Separately, the corporation can only deduct an accrued bonus in the year it was incurred if it is paid within 180 days after that fiscal year-end; otherwise the deduction moves to the year it is actually paid.
Source: CRA — IT-109R2, Unpaid Amounts (archived).
Pension plans reduce room. If your corporation sponsors a registered pension plan or deferred profit sharing plan for you, your T4 shows a pension adjustment that reduces the following year's RRSP room. An individual pension plan in particular can absorb most or all of it.
Overcontributions. The CRA allows a cumulative $2,000 cushion over your deduction limit. Beyond that, a tax of 1% per month applies to the excess until it is withdrawn or new room absorbs it. Contributing the full $35,390 in January 2027 without checking your actual limit is the common way to trigger this.
The 2026 contribution deadline. Contributions made in the first 60 days of 2027 can be deducted on your 2026 return. The 60th day of 2027 is Monday, March 1, 2027. Those contributions use your 2026 room, not the new 2027 limit.
Source: CRA — Important dates for RRSPs, HBP, LLP, FHSAs and more.
What is not published yet
As of today the CRA has published the 2027 RRSP dollar limit, but not the 2027 YMPE or YAMPE, and the 2027 TFSA dollar limit has not been announced. Treat any 2027 TFSA figure circulating online as an estimate until the CRA posts it.
What to do before December 31, 2026
- Decide your 2026 salary now. If you want full 2027 RRSP room, plan at least $196,612 of 2026 earned income, and run the payroll before year-end so it is received in 2026.
- Check pension adjustments if your corporation contributes to an RPP, IPP or DPSP for you.
- Pull your current room from your latest Notice of Assessment before contributing, so the January rush does not create an overcontribution.
- Keep 2026 and 2027 contributions separate: money contributed by March 1, 2027 is usually aimed at the 2026 deduction.
Key takeaways
- The RRSP limit for 2027 is $35,390, up $1,580 from $33,810 in 2026, per the CRA's limits table.
- It takes $196,612 of 2026 earned income to earn the full 2027 limit. Dividends do not count.
- Accrued bonuses count when paid, so a bonus paid in 2027 builds 2028 room.
- The 2026 contribution deadline is March 1, 2027.
RN Canada prepares personal and corporate tax returns and runs payroll for owner-managed businesses, and reviews the salary-dividend mix as part of year-end planning. If you want your 2026 compensation modelled against your 2027 RRSP room before December 31, our corporate and personal tax team can set it up.