Wednesday, March 14, 2012

CRA Form T1213 - Request to Reduce Tax Deductions at Source

Now that the RRSP contribution deadline has passed I wanted to take a moment to let you know about a much under utilized and seldom heard of Canada Revenue Agency form called a T1213 form.  This form is essentially a request made to CRA to allow your employer to recognize that you are putting money aside on a periodic basis into an RRSP or other eligible deductions or non-refundable tax credits and proportionately reduce the amount of taxes being withheld at source by your employer.

One of the major advantages of participating in a group retirement savings program through work is that your RRSP contributions are recognized by your employer at source and as such a proportionately smaller amount of taxes will be withheld from each pay cheque.  This immediate tax relief enables you to enjoy the use of those refunded tax premiums today and not have to wait until you file your tax return to receive your refund. The T1213 form equalizes the playing field between personally held RRSP’s and group sponsored RRSP’s. Just like making contributions through a work sponsored plan, The form allows you to realize your tax savings immediately for regular contributions made into your personally held RRSP just like you do through your work plan.

You can find the form by visiting the Canada Revenue Agency website at http://www.cra-arc.gc.ca and searching for a T1213 form or directly via this link http://www.cra-arc.gc.ca/E/pbg/tf/t1213/

Send the completed form with all supporting documents to the Taxpayer Services Division of your tax services office. You can find the
address on the CRA Web site at www.cra.gc.ca/tso or by calling CRA at 1-800-959-8281.

Once you have submitted the request to CRA for approval, you should hear a response within four to eight weeks to let you know if your request has been approved.

To be eligible to participate all income tax returns that are due must be filed and any amounts owing be paid in full prior to sending the request to CRA.

Also keep in mind that the request approval is only valid for one year so you must resend the request every year.





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