General information only — not financial advice for your situation.
This is a learning tool. Always check CRA My Account records and talk to a qualified professional for your own numbers.
Plain English
If your employer provides a pension, the value of that pension benefit reduces your RRSP room. It keeps things fair between people with and without workplace pensions.
Technical definition
A pension adjustment (PA) represents the value of the benefit earned in a given year under an employer's registered pension plan (RPP) or deferred profit-sharing plan (DPSP). The PA reduces the following year's RRSP deduction limit, ensuring equitable tax-sheltered savings between employees with and without employer pensions.
Examples
- • Your employer's defined-benefit pension generates a $6,000 PA for 2025. Your 2026 RRSP room is reduced by $6,000 — so 18% × $90,000 – $6,000 = $10,200.
- • Without an employer pension (PA = $0), the same $90,000 income gives full RRSP room of $16,200.
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About this site
Every number on this site is sourced from CRA publications, the Income Tax Act, or provincial fiscal releases. We show the math, cite the sources, and never tell you what to do with your money.