Entering RRSP Transaction in GnuCash

Edward Doolittle edward.doolittle at gmail.com
Sun Apr 12 02:41:30 EDT 2015


>From Income:MyName:Non-taxable:RRSP-employer, or something similar. Then
you should use that same account in the income side of your paycheque split.

On 11 April 2015 at 23:42, jfjunior <jfjunior at jfjunior.ca> wrote:

> Thanks Edward,
>
> Breaking the gross income in taxable and non-taxable is a good idea. Now
> from the $1200.00, $1000.00 is what I get net in my account, and the sample
> of 2 x $100.00 entries are taxes, etc. I have about 7 deductions
> (insurance, cpp, ei, charitable donations etc...which I didn't list).
>
> Any idea how I should proceed with the first transaction, when my employer
> makes a deposit to my RRSP account directly? :)
>
> DR: Assets:Investments:EmployerRRSPContrib - $100.00
> CR: Income:MyName:RRSP - $100.00
>
> Thanks again.
>
> Jay
>
>
> On 12 April 2015 at 01:19, Edward Doolittle <edward.doolittle at gmail.com>
> wrote:
>
>> In the last transaction, you should break your gross income into two
>> parts: taxable ($1200) and non-taxable ($500, corresponding to RRSP
>> contribution). Furthermore, maybe not everything in the $1200 is taxable.
>> Paycheques typically have multi-way splits where both the credits and
>> debits are split.
>>
>> On 11 April 2015 at 14:34, jfjunior <jfjunior at jfjunior.ca> wrote:
>>
>>> Hi everyone,
>>>
>>> I've edited my original post for more clarity.
>>>
>>> I'm wondering if someone can help me with a question about the proper
>>> way to
>>> register a transaction where my employer makes a direct contribution to
>>> my
>>> RRSP account.
>>>
>>> RRSP is more or less the Canadian equivalent of the USA 401(k) and as
>>> such
>>> is a Retirement Fund. Basically my employer makes a biweekly
>>> contribution to
>>> my RRSP account. For now I'm registering these transactions as an Income,
>>> however this is not correct because RRSP contributions will only be
>>> considered  income when I have access to the funds, at which time I will
>>> pay
>>> Income Tax on the value I withdrawal from my account.
>>>
>>> This is the way I'm entering my employer RRSP contributions to my RRSP
>>> account in GnuCash, which I think is wrong:
>>>
>>> DR: Assets:Investments:EmployerRRSPContrib - $100.00
>>> CR: Income:MyName:RRSP - $100.00
>>>
>>> Now if I make, for sake of argument,  a withdrawal of $500.00, I will
>>> enter
>>> the transaction in GnuCash as as DR to EmployerRRSPContrib or
>>> EmployeeRRSPContrib - depending from which account I'm making the
>>> withdrawal
>>> from (my own contributions or my employer contributions).
>>>
>>> The example below assumes the withdrawal is from my Employer's RRSP
>>> Contribution account. Note that I'm paying 10% Income Tax on the total
>>> value
>>> of the withdrawal.
>>>
>>> DR: Expenses:Taxes:Income Tax Investments - $50.00
>>> DR: Assets:Current Assets:ChequingAccount - $450.00
>>> CR: Assets:Investments:EmployerRRSPContrib -                $500.00
>>>
>>> I also make RRSP contributions directly from my paycheque, which I
>>> register
>>> in GnuCash this way:
>>>
>>> DR: Assets:Current Assets:ChequingAccount:          $1000.00
>>> DR: Taxes and Deductions:Expense01                      $100.00
>>> DR: Taxes and Deductions:Expense02                      $100.00
>>> DR: Assets:Investments:EmployeeRRSPContrib:         $500.00
>>> CR: Income:Salary:MySelf (Gross Income)
>>> $1700.00
>>>
>>> So the issue here is that the first transaction if fundamentally
>>> incorrect
>>> as I cannot consider the RRSP contribution from my employer as an income
>>> yet, since I've not accessed the funds and paid income taxes on it.
>>>
>>> I would appreciate any input, so I can get this right.
>>>
>>> Thank you very much everyone!
>>>
>>>
>>>
>>> --
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>>
>>
>>
>> --
>> Edward Doolittle
>> Associate Professor of Mathematics
>> First Nations University of Canada
>> 1 First Nations Way, Regina SK S4S 7K2
>>
>> « Toutes les fois que je donne une place vacante, je fais cent mécontents
>> et un ingrat. »
>> -- Louis XIV, dans Voltaire, Le Siècle de Louis XIV, Chap. XXVI
>>
>
>
>
> --
> Simplicity is the ultimate sophistication.
>
>
>
>


-- 
Edward Doolittle
Associate Professor of Mathematics
First Nations University of Canada
1 First Nations Way, Regina SK S4S 7K2

« Toutes les fois que je donne une place vacante, je fais cent mécontents
et un ingrat. »
-- Louis XIV, dans Voltaire, Le Siècle de Louis XIV, Chap. XXVI


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