A Federal Plan which allows a taxpayer to contribute approximately 18% of earned income — to a maximum of $13,500 into a retirement plan \\"tax free\\". If the taxpayer has already paid tax on personal income, then the RRSP contribution (which can be made until March 1st of the year following the year in which the income was earned and taxed) can result in a significant tax rebate.

Since RRSP\'s can be caught up retroactively, this facility and the large cash refunds it can generate are central to numerous Realtor-driven programs designed for first time buyers.