Group RRSPs
Profit Sharing Plans
Retirement Compensation Arrangements
Group RRSPs are much less formal than Registered Pension Plans. There is no formal registered group RRSP vehicle, but rather a single trust or contract may be established to provide income for the individual plans of employees of an employer or members of an association, or their spouses. Neither, at this time, is there any recognition in the Income Tax Act for employer contributions to an RRSP. Only the annuitant may receive the deduction for the contributions made to the RRSP.
Basic Revenue Canada Requirements
The onus is on the issuer of the RRSP to identify that their plan meets the registration requirements. Most often this is accomplished by the filing of a specimen plan that satisfies these requirements. RRSPs may be issued by the following organizations:
- Canadian Trust Companies
- Insurance Companies licensed to sell annuities in Canada
- Companies approved by Governor in Council to sell investment contracts for RRSPs
- Depositories who are members are eligible to become a member of the Canadian Payments Association, or credit unions.
- At maturity the plan must provide for retirement income in the form of equal annual or more frequent period payments, unless commutation occurs.
- The plan must mot provide for a maturity date later than the end of the year in which the annuitant reaches age 71.
- The plan may not receive premiums after the maturity date.
- Before maturity, the plan must not provide for the payment of benefits except for a refund of premiums and a payment to the annuitant.
- The retirement income may not be assigned.
