Entering RRSP Transaction in GnuCash

jfjunior jfjunior at jfjunior.ca
Sun Apr 12 11:29:37 EDT 2015


I see what  you are saying, however here is where I've a problem.

The deposit made by my employer to my RRSP account is not part of my
paycheque, is a direct transaction from my employer to my RRSP account. So
for me to see these individual transactions - which are in company shares
by the way - I need to logon to my SunLife account or wait for my
investment quarterly e-statements.

The only transaction which shows up on my paycheque is my own contribution
to my RRSP account - EmployeeRRSPContrib -  as that one is deducted from my
paycheque.

Would it be a good accounting practice to setup these transactions as
"equity - open account balances" or "equity - retained earnings"? How would
that affect my reporting?

My main concern here is that these deposits are showing up as "income" and
they are not income yet, just assets for the time being.

i.e.

DR: Assets:Investments:EmployerRRSPContrib - $100.00
CR: Equity:Opening Balances - $100.00

or

DR: Assets:Investments:EmployerRRSPContrib - $100.00
CR: Equity:Retained Earnings - $100.00

Thanks

On 12 April 2015 at 02:41, Edward Doolittle <edward.doolittle at gmail.com>
wrote:

> 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!
>>>>
>>>>
>>>>
>>>> --
>>>> View this message in context:
>>>> http://gnucash.1415818.n4.nabble.com/Entering-RRSP-Transaction-in-GnuCash-tp4677764.html
>>>> Sent from the GnuCash - User mailing list archive at Nabble.com.
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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
>



-- 
Simplicity is the ultimate sophistication.


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