KEY RRSP FACTS YOU NEED TO KNOW FOR 2000 AND 2001

Deadline
The deadline for RRSP contributions deductible from your 2000 income is March 1, 2001. To avoid the last-minute crunch, make your contributions early.

Contribution Limit for 2000

You can contribute up to 18% of your earned income in 1999, to a maximum of $13,500, less any pension adjustments (Box 52 on your previous year's T4) and past service pension adjustment, plus any carry-forwards and any pension adjustment reversals. If you are not sure how much you can contribute, your 1999 tax assessment notice from Revenue Canada states your 2000 contribution limit. See below for further information on limits

Contribution Age Limitation
If you are turning 69 years of age in 2000, then this is your last year to make an RRSP contribution.

RRSP Beneficiaries

When an RRSP planholder dies, the value of the plan is taxed in the hands of the deceased planholder, unless the plan assets are paid to a qualified beneficiary as a "refund of premiums". A refund of premiums is taxed in the hands of the receiving beneficiary and may be eligible to be rolled over to the beneficiary's RRSP, RRIF or annuity, if certain requirements are met. Under current legislation, a qualified beneficiary can be the spouse of the deceased planholder or if there is no surviving spouse, a financially dependent child or grandchild of the planholder. As of the 1999 federal budget a financially dependent child or grandchild receives a refund of premiums even if there is a surviving spouse. This change is effective for deaths after 1995. You may want to consider this change in the rules when selecting your RRSP beneficiary(s) within the larger context of your estate plan. The advice of a tax professional is highly recommended.

Home Buyers' Plan

The Home Buyers' Plan ("HBP") was established to assist first time- homebuyers in the purchase of a home. The Plan allows you to make tax-free withdrawals of up to $20,000 from your RRSP to finance the purchase of your first home; in return you are obligated to repay the withdrawn amounts over a period of up to 16 years from the date of the withdrawal.

• To be eligible for the plan, a number of requirements must be met, including being a "first time home buyer" (which means that neither you nor your spouse have owned and lived in a house as your principal place of residence in the year of withdrawal and the four calendar years preceding the withdrawal).
• As of in January, 1999, an individual may be able to participate more than once in the HBP, provided the above requirements and other existing requirements are met and any previous HBP withdrawal has been fully repaid.
• As of January 1, 1999, disabled individuals and certain supporting relatives are eligible to make a HBP withdrawal to purchase a home which is more accessible or better suited to the individual's personal needs, regardless of whether or not they otherwise qualify as a first time homebuyer.

As of January 1, 1999, you are able to make tax-free RRSP withdrawals to finance eligible education or training for either yourself or your spouse. You must meet the following requirements to qualify(other requirements may also need to be meet):

• Withdrawals cannot exceed $10,000 per year or $20,000 in total.
• Withdrawals can be made over a maximum 4-year period.
• Contributions to the RRSP must have been made at least 90 days prior to an LLP withdrawal or they will not be deductible.
• You can participate in the plan more than once, as long as the previous withdrawal is fully repaid and other conditions are met.
• Repayment must be made within ten years, and must start no later than sixty days after the fifth year following the year of the first withdrawal. For example, if you've withdrawn funds in January of 1999, you will have to begin your repayments no later than March 1, 2005 (required repayments may begin earlier in certain circumstances). At this point your 10-year repayment period starts to run, ending February 28, 2015.
• To qualify under the plan, you or your spouse must be enrolled as a full-time student in a qualifying educational program of at least three months duration at the time of the withdrawal, or have received notification of absolute entitlement to enroll in such a program.
• Similar to the HBP, repayments made during the 10-year period must reach a regulated minimum threshold yearly, or the short fall will be included in the individual's income for that year.

Calculating How Much You Can Contribute

$13,500 or 18% of your prior year's earned income

and subtract any pension adjustment from the previous year if you are a Deferred Profit Sharing Plan or Registered Pension Plan member (and the Past Service Pension Adjustment, if applicable). The remaining figure is the amount you may contribute for the current year.

The maximum contribution is frozen at $13,500 through to 2003. At that time, it's scheduled to increase to $14,500, then $15,500 in 2004 and 2005.

Foreign Content Rules

Investments for Your RRSP

• Canadian equities
• Foreign equities
• A wide range of RRSP-eligible mutual funds
• Income trust units
• Canada Savings Bonds
• Provincial savings bonds
• Federal, provincial and municipal bonds
• Strip bonds
• Corporate bonds
• Mortgage-backed securities
• GICs
• Treasury bills
• Canadian mortgages on your principal residence
• Index-linked products
• Segregated funds from Life Insurance Companies