VIII, s. 85(2)]
wage measurefor a month means the average weekly wages and salaries of
(a)the Industrial Aggregate in Canada for the month as published by Statistics Canada under theStatistics Act, or
(b)in the event that the Industrial Aggregate ceases to be published, such other measure for the month as is prescribed by regulation under theCanada Pension Planfor the purposes of paragraph 18(5)(b) of that Act. (mesure des gains)
Marginal note:Registration of plan
(2)The following rules apply with respect to the registration of pension plans:
(a)the Minister shall not register a pension plan unless
(i)application for registration is made in prescribed manner by the plan administrator,
(ii)the plan complies with prescribed conditions for registration, and
(iii)where the plan is required to be registered under thePension Benefits Standards Act, 1985or a similar law of a province, application for such registration has been made;
(b)where a pension plan that was submitted for registration before 1992 is registered by the Minister, the registration is effective from the day specified in writing by the Minister; and
(c)where a pension plan that is submitted for registration after 1991 is registered by the Minister, the registration is effective from the later of
(i)January 1 of the calendar year in which application for registration is made in prescribed manner by the plan administrator, and
(ii)the day the plan began.
Marginal note:Deemed registration
(3)Where application is made to the Minister for registration of a pension plan for the purposes of this Act and, where the manner for making the application has been prescribed, the application is made in that manner by the administrator,
(a)subject to paragraph 147.1(3)(b), the plan is, for the purposes of this Act other than paragraphs 60(j) and 60(j.2) and sections 147.3 and 147.4, deemed to be a registered pension plan throughout the period that begins on the latest of
(i)January 1 of the calendar year in which the application is made,
(ii)the day of commencement of the plan, and
(iii)January 1, 1989
and ending on the day on which a final determination is made with respect to the application; and
(b)where the final determination made with respect to the application is a refusal to register the plan, this Act shall, after the day of the final determination, apply as if the plan had never been deemed, under paragraph 147.1(3)(a), to be a registered pension plan, except that
(i)any information return otherwise required to be filed under subsection 207.7(3) before the particular day that is 90 days after the day of the final determination is not required to be filed until the particular day, and
(ii)subsections 227(8) and 227(8.2) are not applicable with respect to contributions made to the plan on or before the day of the final determination.
Marginal note:Acceptance of amendments
(4)The Minister shall not accept an amendment to a registered pension plan unless
(a)application for the acceptance is made in prescribed manner by the plan administrator;
(b)the plan as amended complies with prescribed conditions for registration; and
(c)the amendment complies with prescribed conditions.
Marginal note:Additional conditions
(5)The Minister may, at any time, impose reasonable conditions applicable with respect to registered pension plans, a class of such plans or a particular registered pension plan.
Marginal note:Administrator
(6)There shall, for each registered pension plan, be a person or a body of persons that has ultimate responsibility for the administration of the plan and, except as otherwise permitted in writing by the Minister, the person or a majority of the persons who constitute the body shall be a person or persons resident in Canada.
Marginal note:Obligations of administrator
(7)The administrator of a registered pension plan shall
(a)administer the plan in accordance with the terms of the plan as registered except that, where the plan fails to comply with the prescribed conditions for registration or any other requirement of this Act or the regulations, the administrator may administer the plan as if it were amended to so comply;
(b)before July, 1990, in the case of a person or body that is the administrator on January 1, 1989 or becomes the administrator before June, 1990, and, in any other case, within 30 days after becoming the administrator, inform the Minister in writing
(i)of the name and address of the person who is the administrator, or
(ii)of the names and addresses of the persons who constitute the body that is the administrator; and
(c)where there is any change in the information provided to the Minister in accordance with this paragraph or paragraph 147.1(7)(b), inform the Minister in writing, within 60 days after the change, of the new information.
Marginal note:Pension adjustment limits
(8)Except as otherwise provided by regulation, a registered pension plan (other than a multi-employer plan) becomes, at the end of a calendar year after 1990, a revocable plan where
(a)the pension adjustment for the year of a member of the plan in respect of a participating employer exceeds the lesser of
(i)the money purchase limit for the year, and
(ii)18% of the member’s compensation from the employer for the year; or
(b)the total of
(i)the pension adjustment for the year of a member of the plan in respect of a participating employer, and
(ii)the total of all amounts each of which is the member’s pension adjustment for the year in respect of an employer who, at any time in the year, does not deal at arm’s length with the employer referred to in subparagraph 147.1(8)(b)(i)
exceeds the money purchase limit for the year.
Marginal note:Idem — multi-employer plans
(9)Except as otherwise provided by regulation, a registered pension plan that is a multi-employer plan (other than a specified multi-employer plan) in a calendar year after 1990 becomes, at the end of the year, a revocable plan where
(a)for a member and an employer, the total of all amounts each of which is the member’s pension credit (as prescribed by regulation) for the year in respect of the employer under a defined benefit or money purchase provision of the plan exceeds the lesser of
(i)the money purchase limit for the year, and
(ii)18% of the member’s compensation from the employer for the year; or
(b)for a member, the total of all amounts each of which is the member’s pension credit (as prescribed by regulation) for the year in respect of an employer under a defined benefit or money purchase provision of the plan exceeds the money purchase limit for the year.
Marginal note:Past service benefits
(10)With respect to each past service event that is relevant to the determination of benefits in respect of a member under a defined benefit provision of a registered pension plan, such benefits as are in respect of periods after 1989 and before the calendar year in which the event occurred shall be determined, for the purpose of a payment to be made from the plan or a contribution to be made to the plan at a particular time, with regard to the event only if
(a)where the member is alive at the particular time and except as otherwise provided by regulation, the Minister has certified in writing, before the particular time, that prescribed conditions are satisfied,
(b)where the member died before the particular time and the event occurred before the death of the member,
(i)this subsection did not require that the event be disregarded in determining benefits that were payable to the member immediately before the member’s death (or that would have been so payable had the member been entitled to receive benefits under the provision immediately before the member’s death), or
(ii)the event, as it affects the benefits provided to each individual who is entitled to benefits as a consequence of the death of the member, is acceptable to the Minister,
(c)where the member died before the particular time and the event occurred after the death of the member, the event, as it affects the benefits provided to each individual who is entitled to benefits as a consequence of the death of the member, is acceptable to the Minister, and
(d)no past service event that occurred before the event is required by reason of the application of this subsection to be disregarded at the particular time in determining benefits in respect of the member,
and, for the purposes of this subsection as it applies with respect to contributions that may be made to a registered pension plan, where application has been made for a certification referred to in paragraph 147.1(10)(a) and the Minister has not refused to issue the certification, the Minister shall be deemed to have issued the certification.
Marginal note:Revocation of registration — notice of intention
(11)Where, at any time after a pension plan has been registered by the Minister,
(a)the plan does not comply with the prescribed conditions for registration,
(b)the plan is not administered in accordance with the terms of the plan as registered,
(c)the plan becomes a revocable plan,
(d)a condition imposed by the Minister in writing and applicable with respect to the plan (including a condition applicable generally to registered pension plans or a class of such plans and a condition first imposed before 1989) is not complied with,
(e)a requirement under subsection 147.1(6) or 147.1(7) is not complied with,
(f)a benefit is paid by the plan, or a contribution is made to the plan, contrary to subsection 147.1(10),
(g)the administrator of the plan fails to file an information return or actuarial report relating to the plan or to a member of the plan as and when required by regulation,
(h)a participating employer fails to file an information return relating to the plan or to a member of the plan as and when required by regulation, or
(i)registration of the plan under thePension Benefits Standards Act, 1985or a similar law of a province is refused or revoked,
the Minister may give notice (in this subsection and subsection 147.1(12) referred to as a “notice of intent”) by registered mail to the plan administrator that the Minister proposes to revoke the registration of the plan as of a date specified in the notice of intent, which date shall not be earlier than the date as of which,
(j)where paragraph 147.1(11)(a) applies, the plan failed to so comply,
(k)where paragraph 147.1(11)(b) applies, the plan was not administered in accordance with its terms as registered,
(l)where paragraph 147.1(11)(c) applies, the plan became a revocable plan,
(m)where paragraph 147.1(11)(d) or 147.1(11)(e) applies, the condition or requirement was not complied with,
(n)where paragraph 147.1(11)(f) applies, the benefit was paid or the contribution was made,
(o)where paragraph 147.1(11)(g) or 147.1(11)(h) applies, the information return or actuarial report was required to be filed, and
(p)where paragraph 147.1(11)(i) applies, the registration referred to in that paragraph was refused or revoked.
Marginal note:Notice of revocation
(12)Where the Minister gives a notice of intent to the administrator of a registered pension plan, or the plan administrator applies to the Minister in writing for the revocation of the plan’s registration, the Minister may,
(a)where the plan administrator has applied to the Minister in writing for the revocation of the plan’s registration, at any time after receiving the administrator’s application, and
(b)in any other case, after 30 days after the day of mailing of the notice of intent,
give notice (in this subsection and subsection 147.1(13) referred to as a “notice of revocation”) by registered mail to the plan administrator that the registration of the plan is revoked as of the date specified in the notice of revocation, which date may not be earlier than the date specified in the notice of intent or the administrator’s application, as the case may be.
Marginal note:Revocation of registration
(13)Where the Minister gives a notice of revocation to the administrator of a registered pension plan, the registration of the plan is revoked as of the date specified in the notice of revocation, unless the Federal Court of Appeal or a judge thereof, on application made at any time before the determination of an appeal pursuant to subsection 172(3), orders otherwise.
Marginal note:Anti-avoidance — multi-employer plans
(14)Where at any time the Minister gives written notice to the administrators of two or more registered pension plans, each of which is a multi-employer plan, that this subsection is applicable in relation to those plans with respect to a calendar year,
(a)each of those plans that is a specified multi-employer plan in the year shall, for the purposes of subsection 147.1(9) (other than for the purpose of determining the pension credits referred to in paragraphs 147.1(9)(a) and 147.1(9)(b)), be deemed to be a multi-employer plan that is not a specified multi-employer plan; and
(b)the totals determined for the year under paragraphs 147.1(9)(a) and 147.1(9)(b) shall be the amounts that would be determined if all the plans were a single plan.
Marginal note:Plan as registered
(15)Any reference in this Act and the regulations to a pension plan as registered means the terms of the plan on the basis of which the Minister has registered the plan for the purposes of this Act and as amended by
(a)each amendment that has been accepted by the Minister, and
(b)each amendment that has been submitted to the Minister for acceptance and that the Minister has neither accepted nor refused to accept, if it is reasonable to expect the Minister to accept the amendment,
and includes all terms that are not contained in the documents constituting the plan but that are terms of the plan by reason of the Pension Benefits Standards Act, 1985 or a similar law of a province.
Marginal note:Separate liability for obligations
(16)Every person who is a member of a body that is the administrator of a registered pension plan is subject to all obligations imposed on administrators by this Act or a regulation as if the person were the administrator of the plan.
Marginal note:Superintendent of Financial Institutions
(17)The Minister may, for the purposes of this Act, obtain the advice of the Superintendent of Financial Institutions with respect to any matter relating to pension plans.
Marginal note:Regulations
(18)The Governor in Council may make regulations
(a)prescribing conditions for the registration of pension plans and enabling the Minister to impose additional conditions or waive any conditions that are prescribed;
(b)prescribing circumstances under which a registered pension plan becomes a revocable plan;
(c)specifying the manner of determining, or enabling the Minister to determine, the portion of a member’s benefits under a registered pension plan that is in respect of any period;
(d)requiring administrators of registered pension plans to make determinations in connection with the computation of pension adjustments, past service pension adjustments, total pension adjustment reversals or any other related amounts (all such amounts referred to in this subsection as “specified amounts”);
(e)requiring that the method used to determine a specified amount be acceptable to the Minister, where more than one method would otherwise comply with the regulations;
(f)enabling the Minister to permit or require a specified amount to be determined in a manner different from that set out in the regulations;
(g)requiring that any person who has information required by another person in order to determine a specified amount provide the other person with that information;
(h)enabling the Minister to require any person to provide the Minister with information relating to the method used to determine a specified amount;
(i)enabling the Minister to require any person to provide the Minister with information relevant to a claim that paragraph 147.1(10)(a) is not applicable by reason of an exemption provided by regulation;
(j)respecting applications for certifications for the purposes of subsection 147.1(10);
(k)enabling the Minister to waive the requirement for a certification for the purposes of subsection 147.1(10);
(l)prescribing rules for the purposes of subsection 147.1(10), so that that subsection applies or does not apply with respect to benefits provided as a consequence of particular transactions, events or circumstances;
(m)requiring any person to provide the Minister or the administrator of a registered pension plan with information in connection with an application for certification for the purposes of subsection 147.1(10);
(n)requiring any person who obtains a certification for the purposes of subsection 147.1(10) to provide the individual in respect of whom the certification was obtained with an information return;
(o)requiring administrators of registered pension plans to file information with respect to amendments to such plans and to the arrangements for funding benefits thereunder;
(p)requiring administrators of registered pension plans to file information returns respecting such plans;
(q)enabling the Minister to require any person to provide the Minister with information for the purpose of determining whether the registration of a pension plan may be revoked;
(r)requiring administrators of registered pension plans to submit reports to the Minister, prescribing the class of persons by whom the reports shall be prepared and prescribing information to be contained in those reports;
(s)enabling the Minister to impose any requirement that may be imposed by regulation made under paragraph 147.1(18)(r);
(t)defining, for the purposes of this Act, the expressionsmulti-employer plan,past service event,past service pension adjustment,pension adjustment,specified multi-employer planandtotal pension adjustment reversal; and
(u)generally to carry out the purposes and provisions of this Act relating to registered pension plans and the determination and reporting of specified amounts.
Marginal note:Reasonable error
(19)The administrator of a registered pension plan may make a payment (other than a payment made to avoid the revocation of the registration of the plan) that is a return of all or a portion of a contribution made by a member of the plan, or an employer who participates in the plan, if
(a)the contribution was made to the plan as a consequence of a reasonable error;
(b)the payment is made to the member or employer, as the case may be, who made the contribution; and
(c)the payment is made no later than December 31 of the year following the year in which the contribution was made.
Marginal note:Pension contributions deductible — employer contributions
147.2(1)For a taxation year ending after 1990, there may be deducted in computing the income of a taxpayer who is an employer the total of all amounts each of which is a contribution made by the employer after 1990 and either in the taxation year or within 120 days after the end of the taxation year to a registered pension plan in respect of the employer’s employees or former employees, to the extent that
(a)in the case of a contribution in respect of a money purchase provision of a plan, the contribution was made in accordance with the plan as registered and in respect of periods before the end of the taxation year;
(b)in the case of a contribution in respect of the defined benefit provisions of a plan (other than a specified multi-employer plan), the contribution
(i)is an eligible contribution,
(ii)was made to fund benefits provided to employees and former employees of the employer in respect of periods before the end of the taxation year, and
(iii)complies with subsection 147.1(10);
(c)in the case of a contribution made to a plan that is a specified multi-employer plan, the contribution was made in accordance with the plan as registered and in respect of periods before the end of the taxation year; and
(d)the contribution was not deducted in computing the income of the employer for a preceding taxation year.
Marginal note:Employer contributions — defined benefit provisions
(2)For the purposes of subsection 147.2(1), a contribution made by an employer to a registered pension plan in respect of the defined benefit provisions of the plan is an eligible contribution if it is a prescribed contribution or if it complies with prescribed conditions and is made pursuant to a recommendation by an actuary in whose opinion the contribution is required to be made so that the plan will have sufficient assets to pay benefits under the defined benefit provisions of the plan, as registered, in respect of the employees and former employees of the employer, where
(a)the recommendation is based on an actuarial valuation that complies with the following conditions, except the conditions in subparagraphs 147.2(2)(a)(iii) and 147.2(2)(a)(iv) to the extent that they are inconsistent with any other conditions that apply for the purpose of determining whether the contribution is an eligible contribution:
(i)the effective date of the valuation is not more than 4 years before the day on which the contribution is made,
(ii)actuarial liabilities and current service costs are determined in accordance with an actuarial funding method that produces a reasonable matching of contributions with accruing benefits,
(iii)all assumptions made for the purposes of the valuation are reasonable at the time the valuation is prepared and at the time the contribution is made,
(iv)the valuation is prepared in accordance with generally accepted actuarial principles,
(v)the valuation complies with prescribed conditions, which conditions may include conditions regarding the benefits that may be taken into account for the purposes of the valuation, and
(vi)where more than one employer participates in the plan, assets and actuarial liabilities are apportioned in a reasonable manner among participating employers in respect of their employees and former employees, and
(b)the recommendation is approved by the Minister in writing,
and, for the purposes of this subsection and except as otherwise provided by regulation,
(c)the benefits taken into account for the purposes of a recommendation may include anticipated cost-of-living and similar adjustments where the terms of a pension plan do not require that those adjustments be made but it is reasonable to expect that they will be made, and
(d)a recommendation with respect to the contributions required to be made by an employer in respect of the defined benefit provisions of a pension plan may be prepared without regard to such portion of the assets of the plan apportioned to the employer in respect of the employer’s employees and former employees as does not exceed the lesser of
(i)the amount of actuarial surplus in respect of the employer, and
(ii)25% of the amount of actuarial liabilities apportioned to the employer in respect of the employer’s employees and former employees.
Marginal note:Filing of actuarial report
(3)Where, for the purposes of subsection 147.2(2), a person seeks the Minister’s approval of a recommendation made by an actuary in connection with the contributions to be made by an employer to a registered pension plan in respect of the defined benefit provisions of the plan, the person shall file with the Minister a report prepared by the actuary that contains the recommendation and any other information required by the Minister.
Marginal note:Amount of employee’s pension contributions deductible
(4)There may be deducted in computing the income of an individual for a taxation year ending after 1990 an amount equal to the total of
Marginal note:Service after 1989
(a)the total of all amounts each of which is a contribution (other than a prescribed contribution) made by the individual in the year to a registered pension plan that is in respect of a period after 1989 or that is a prescribed eligible contribution, to the extent that the contribution was made in accordance with the plan as registered,
Marginal note:Service before 1990 while not a contributor
(b)the least of
(i)the amount, if any, by which
(A)the total of all amounts each of which is a contribution (other than an additional voluntary contribution or a prescribed contribution) made by the individual in the year or a preceding taxation year and after 1945 to a registered pension plan in respect of a particular year before 1990, if all or any part of the particular year is included in the individual’s eligible service under the plan and if
(I)in the case of a contribution that the individual made before March 28, 1988 or was obliged to make under the terms of an agreement in writing entered into before March 28, 1988, the individual was not a contributor to the plan in the particular year, or
(II)in any other case, the individual was not a contributor to any registered pension plan in the particular year
exceeds
(B)the total of all amounts each of which is an amount deducted, in computing the individual’s income for a preceding taxation year, in respect of contributions included in the total determined in respect of the individual for the year under clause 147.2(4)(b)(i)(A),
(ii)$3,500, and
(iii)the amount determined by the formula
($3,500 × Y) - Z
where
(A)all or any part of which is included in the individual’s eligible service under a registered pension plan to which the individual has made a contribution that is included in the total determined under clause 147.2(4)(b)(i)(A) and in which the individual was not a contributor to any registered pension plan, or
(B)all or any part of which is included in the individual’s eligible service under a registered pension plan to which the individual has made a contribution
(I)that is included in the total determined under clause 147.2(4)(b)(i)(A), and
(II)that the individual made before March 28, 1988 or was obliged to make under the terms of an agreement in writing entered into before March 28, 1988, and in which the individual was not a contributor to the plan, and
(A)in respect of contributions included in the total determined in respect of the individual for the year under clause 147.2(4)(b)(i)(A), or
(B)where the preceding year was before 1987, under subparagraph 8(1)(m)(ii) (as it read in its application to that preceding year) in respect of additional voluntary contributions made in respect of a year that satisfies the conditions in the description of Y, and
Marginal note:Service before 1990 while a contributor
(c)the lesser of
(i)the amount, if any, by which
(A)the total of all amounts each of which is a contribution (other than an additional voluntary contribution, a prescribed contribution or a contribution included in the total determined in respect of the individual for the year under clause 147.2(4)(b)(i)(A)) made by the individual in the year or a preceding taxation year and after 1962 to a registered pension plan in respect of a particular year before 1990 that is included, in whole or in part, in the individual’s eligible service under the plan
exceeds
(B)the total of all amounts each of which is an amount deducted, in computing the individual’s income for a preceding taxation year, in respect of contributions included in the total determined in respect of the individual for the year under clause 147.2(4)(c)(i)(A), and
(ii)the amount, if any, by which $3,500 exceeds the total of the amounts deducted by reason of paragraphs 147.2(4)(a) and 147.2(4)(b) in computing the individual’s income for the year.
Marginal note:Teachers
(5)For the purpose of determining whether a teacher may deduct an amount contributed by the teacher to a registered pension plan in computing the teacher’s income for a taxation year ending after 1990 and before 1995 during which the teacher was employed by Her Majesty or a person exempt from tax for the year under section 149,
(a)clause 147.2(4)(b)(i)(A) shall be read without reference to subclauses 147.2(4)(b)(i)(A)(I) and 147.2(4)(b)(i)(A)(II); and
(b)the description of Y in subparagraph 147.2(4)(b)(iii) shall be read as follows:
Marginal note:Deductible contributions when taxpayer dies
(6)Where a taxpayer dies in a taxation year, for the purpose of computing the taxpayer’s income for the year and the preceding taxation year,
(a)paragraph 147.2(4)(b) shall be read without reference to subparagraph 147.2(6)(a)(ii) and as if the reference to “the least of” were a reference to “the lesser of”; and
(b)paragraph 147.2(4)(c) shall be read without reference to subparagraph 147.2(6)(b)(ii) and the words “the lesser of”.
Marginal note:Letter of credit
(7)For the purposes of this section and any regulations made under subsection 147.1(18) in respect of eligible contributions, an amount paid to a registered pension plan by the issuer of a letter of credit issued in connection with an employer’s funding obligations under a defined benefit provision of the plan is deemed to be an eligible contribution made to the plan in respect of the provision by the employer with respect to the employer’s employees or former employees, if
(a)the amount is paid under the letter of credit;
(b)the use of the letter of credit is permitted under thePension Benefits Standards Act, 1985or a similar law of a province; and
(c)the amount would have been an eligible contribution under subsection (2) if
(i)it had been paid to the plan by the employer, and
(ii)this section were read without reference to this subsection.
Marginal note:Former employee of predecessor employer
(8)For the purposes of this section and any regulations made under subsection 147.1(18) in respect of eligible contributions, a former employee of a predecessor employer (as defined by regulation) of a participating employer in relation to a pension plan is deemed to be a former employee of the participating employer in relation to the plan if
(a)the former employee would not otherwise be an employee or former employee of the participating employer; and
(b)benefits are provided to the former employee under a defined benefit provision of the plan in respect of periods of employment with the predecessor employer.
Marginal note:Transfer — money purchase to money purchase, RRSP or RRIF
147.3(1)An amount is transferred from a registered pension plan in accordance with this subsection if the amount
(a)is a single amount;
(b)is transferred on behalf of a member in full or partial satisfaction of the member’s entitlement to benefits under a money purchase provision of the plan as registered; and
(c)is transferred directly to
(i)another registered pension plan to provide benefits in respect of the member under a money purchase provision of that plan,
(ii)a registered retirement savings plan under which the member is the annuitant (within the meaning assigned by subsection 146(1)),
(iii)a registered retirement income fund under which the member is the annuitant (within the meaning assigned by subsection 146.3(1)), or
(iv)a licensed annuities provider to acquire an advanced life deferred annuity for the benefit of the member.
Marginal note:Transfer — money purchase to defined benefit
(2)An amount is transferred from a registered pension plan in accordance with this subsection if the amount
(a)is a single amount;
(b)is transferred on behalf of a member in full or partial satisfaction of the member’s entitlement to benefits under a money purchase provision of the plan as registered; and
(c)is transferred directly to another registered pension plan to fund benefits provided in respect of the member under a defined benefit provision of that plan.
Marginal note:Transfer — defined benefit to defined benefit
(3)An amount is transferred from a registered pension plan (in this subsection referred to as the “transferor plan”) in accordance with this subsection if the amount
(a)is a single amount;
(b)consists of all or any part of the property held in connection with a defined benefit provision of the transferor plan;
(c)is transferred directly to another registered pension plan to be held in connection with a defined benefit provision of the other plan, unless the transfer is to anindividual pension plan(as defined in subsection 8300(1) of theIncome Tax Regulations) and is in respect of benefits that are attributable to employment with a former employer that is not a participating employer (or its predecessor employer); and
(d)is transferred as a consequence of benefits becoming provided under the defined benefit provision of the other plan to one or more individuals who were members of the transferor plan.
Marginal note:Transfer — defined benefit to money purchase, RRSP or RRIF
(4)An amount is transferred from a registered pension plan in accordance with this subsection if the amount
(a)is a single amount no portion of which relates to an actuarial surplus;
(b)is transferred on behalf of a member in full or partial satisfaction of benefits to which the member is entitled, either absolutely or contingently, under a defined benefit provision of the plan as registered;
(c)does not exceed a prescribed amount; and
(d)is transferred directly to
(i)another registered pension plan and allocated to the member under a money purchase provision of that plan,
(ii)a registered retirement savings plan under which the member is the annuitant (within the meaning assigned by subsection 146(1)), or
(iii)a registered retirement income fund under which the member is the annuitant (within the meaning assigned by subsection 146.3(1)).
Marginal note:Transfer of surplus — defined benefit to money purchase
(4.1)An amount is transferred from a registered pension plan in accordance with this subsection if the amount
(a)is transferred in respect of the actuarial surplus under a defined benefit provision of the plan; and
(b)is transferred directly to another registered pension plan and allocated under a money purchase provision of that plan to one or more members of that plan.
Marginal note:Transfer to RPP, RRSP or RRIF for spouse on marriage breakdown
(5)An amount is transferred from a registered pension plan in accordance with this subsection if the amount
(a)is a single amount no portion of which relates to an actuarial surplus;
(b)is transferred on behalf of an individual who is a spouse or common-law partner or former spouse or common-law partner of a member of the plan and who is entitled to the amount under a decree, order or judgment of a competent tribunal, or under a written agreement, relating to a division of property between the member and the individual in settlement of rights arising out of, or on a breakdown of, their marriage or common-law partnership; and
(c)is transferred directly to
(i)another registered pension plan for the benefit of the individual,
(ii)a registered retirement savings plan under which the individual is the annuitant (within the meaning assigned by subsection 146(1)), or
(iii)a registered retirement income fund under which the individual is the annuitant (within the meaning assigned by subsection 146.3(1)).
Marginal note:Transfer — pre-1991 contributions
(6)An amount is transferred from a registered pension plan in accordance with this subsection if the amount
(a)is a single amount;
(b)is transferred on behalf of a member who is entitled to the amount as a return of contributions made (or deemed by regulation to have been made) by the member under a defined benefit provision of the plan before 1991, or as interest (computed at a rate not exceeding a reasonable rate) in respect of those contributions; and
(c)is transferred directly to
(i)another registered pension plan for the benefit of the member,
(ii)a registered retirement savings plan under which the member is the annuitant (within the meaning assigned by subsection 146(1)), or
(iii)a registered retirement income fund under which the member is the annuitant (within the meaning assigned by subsection 146.3(1)).
Marginal note:Transfer — lump sum benefits on death
(7)An amount is transferred from a registered pension plan in accordance with this subsection if the amount
(a)is a single amount no portion of which relates to an actuarial surplus;
(b)is transferred on behalf of an individual who is entitled to the amount as a consequence of the death of a member of the plan and who was a spouse or common-law partner or former spouse or common-law partner of the member at the date of the member’s death; and
(c)is transferred directly to
(i)another registered pension plan for the benefit of the individual,
(ii)a registered retirement savings plan under which the individual is the annuitant (within the meaning assigned by subsection 146(1)), or
(iii)a registered retirement income fund under which the individual is the annuitant (within the meaning assigned by subsection 146.3(1)).
Marginal note:Transfer where money purchase plan replaces money purchase plan
(7.1)An amount is transferred from a registered pension plan (in this subsection referred to as the “transferor plan”) in accordance with this subsection if
(a)the amount is a single amount;
(b)the amount is transferred in respect of the surplus (as defined by regulation) under a money purchase provision (in this subsection referred to as the “former provision”) of the transferor plan;
(c)the amount is transferred directly to another registered pension plan to be held in connection with a money purchase provision (in this subsection referred to as the “current provision”) of the other plan;
(d)the amount is transferred in conjunction with the transfer of amounts from the former provision to the current provision on behalf of all or a significant number of members of the transferor plan whose benefits under the former provision are replaced by benefits under the current provision; and
(e)the transfer is acceptable to the Minister and the Minister has so notified the administrator of the transferor plan in writing.
Marginal note:Transfer where money purchase plan replaces defined benefit plan
(8)An amount is transferred from a registered pension plan (in this subsection referred to as the “transferor plan”) in accordance with this subsection if
(a)the amount is a single amount;
(b)the amount is transferred in respect of the actuarial surplus under a defined benefit provision of the transferor plan;
(c)the amount is transferred directly to another registered pension plan to be held in connection with a money purchase provision of the other plan;
(d)the amount is transferred in conjunction with the transfer of amounts from the defined benefit provision to the money purchase provision on behalf of all or a significant number of members of the transferor plan whose benefits under the defined benefit provision are replaced by benefits under the money purchase provision; and
(e)the transfer is acceptable to the Minister and the Minister has so notified the administrator of the transferor plan in writing.
Marginal note:Taxation of amount transferred
(9)Where an amount is transferred in accordance with any of subsections 147.3(1) to (8),
(a)the amount shall not, by reason only of that transfer, be included by reason of subparagraph 56(1)(a)(i) in computing the income of any taxpayer; and
(b)no deduction may be made under any provision of this Act in respect of the amount in computing the income of any taxpayer.
Marginal note:Idem
(10)Where, on behalf of an individual, an amount is transferred from a registered pension plan (in this subsection referred to as the “transferor plan”) to another plan or fund (in this subsection referred to as the “transferee plan”) that is a registered pension plan, a registered retirement savings plan or a registered retirement income fund and the transfer is not in accordance with any of subsections 147.3(1) to (7),
(a)the amount is deemed to have been paid from the transferor plan to the individual;
(b)subject to paragraph 147.3(10)(c), the individual shall be deemed to have paid the amount as a contribution or premium to the transferee plan; and
(c)where the transferee plan is a registered retirement income fund, for the purposes of subsection 146(5) and Part X.1, the individual shall be deemed to have paid the amount at the time of the transfer as a premium under a registered retirement savings plan under which the individual was the annuitant (within the meaning assigned by subsection 146(1)).
Marginal note:Division of transferred amount
(11)Where an amount is transferred from a registered pension plan to another registered pension plan, to a registered retirement savings plan or to a registered retirement income fund and a portion, but not all, of the amount is transferred in accordance with any of subsections 147.3(1) to (8),
(a)subsection 147.3(9) applies with respect to the portion of the amount that is transferred in accordance with any of subsections 147.3(1) to (8); and
(b)subsection 147.3(10) applies with respect to the remainder of the amount.
Marginal note:Restriction re transfers
(12)A registered pension plan becomes a revocable plan at any time that an amount is transferred from the plan to another registered pension plan, to a registered retirement savings plan or to a registered retirement income fund unless
(a)the amount is transferred in accordance with any of subsections 147.3(1) to (8); or
(b)where the amount is transferred on behalf of an individual,
(i)the amount is deductible by the individual under paragraph 60(j) or (j.2), or
(ii)thePension Benefits Standards Act, 1985or a similar law of a province prohibits the payment of the amount to the individual.
Marginal note:Excess transfer
(13)Where
(a)the transfer in a calendar year of an amount from a registered pension plan on behalf of a member of the plan would, but for this subsection, be in accordance with subsection 147.3(1) or (2), and
(b)the plan becomes, at the end of the year, a revocable plan as a consequence of an excess determined under any of paragraphs 147.1(8)(a) and (b) and (9)(a) and (b) with respect to the member (whether or not such an excess is also determined with respect to any other member),
such portion of the amount transferred as may reasonably be considered to derive from amounts allocated or reallocated to the member in the year or from earnings reasonably attributable to those amounts shall, except to the extent otherwise expressly provided in writing by the Minister, be deemed to be an amount that was not transferred in accordance with subsection 147.3(1) or (2), as the case may be.
Marginal note:Withdrawal of excessive transfers to RRSPs and RRIFs
(13.1)There may be deducted in computing the income of an individual for a taxation year the lesser of
(a)the amount, if any, by which
(i)the total of all amounts each of which is an amount included under clause 56(1)(a)(i)(C), paragraph 56(1)(z.3), subsections 146(8), (8.3) or (12) or 146.3(5), (5.1) or (11) in computing the individual’s income for the year, to the extent that the amount is not a prescribed withdrawal,
exceeds
(ii)the total of all amounts each of which is an amount deductible under paragraph 60(l) or subsection 146(8.2) in computing the income of the individual for the year, and
(b)the amount, if any, by which
(i)the total of all amounts each of which is an amount that was
(A)transferred to a registered retirement savings plan or registered retirement income fund under which the individual was the annuitant (within the meaning assigned by subsection 146(1) or 146.3(1), as the case may be),
(B)included in computing the income of the individual for the year or a preceding taxation year, and
(C)deemed by paragraph 147.3(10)(b) or 147.3(10)(c) to have been paid by the individual as a premium to a registered retirement savings plan,
exceeds
(ii)the total of all amounts each of which is an amount
(A)deductible under this subsection in computing the individual’s income for a preceding taxation year, or
(B)deducted under subsection 146(5) in computing the individual’s income for a preceding taxation year, to the extent that the amount can reasonably be considered to be in respect of an amount referred to in subparagraph 147.3(13.1)(b)(i).
Marginal note:Deemed transfer
(14)For the purposes of this section and the regulations, where property held in connection with a particular pension plan is made available to pay benefits under another pension plan, the property shall be deemed to have been transferred from the particular plan to the other plan.
Marginal note:Transfer of property between provisions
(14.1)Where property held in connection with a benefit provision of a registered pension plan is made available to pay benefits under another benefit provision of the plan, subsections 147.3(9) to 147.3(11) apply in respect of the transaction by which the property is made so available in the same manner as they would apply if the other benefit provision were in another registered pension plan.
(15)[Repealed, 1998, c. 19, s. 175(2)]
Marginal note:RPP annuity contract
147.4(1)Where
(a)at any time an individual acquires, in full or partial satisfaction of the individual’s entitlement to benefits under a registered pension plan, an interest in an annuity contract (other than an advanced life deferred annuity) purchased from a licensed annuities provider,
(b)the rights provided for under the contract are not materially different from those provided for under the plan as registered,
(c)the contract does not permit premiums to be paid at or after that time, other than a premium paid at that time out of or under the plan to purchase the contract,
(d)either the plan is not a plan in respect of which the Minister may, under subsection 147.1(11), give a notice of intent to revoke the registration of the plan or the Minister waives the application of this paragraph with respect to the contract and so notifies the administrator of the plan in writing, and
(e)the individual does not acquire the interest as a consequence of a transfer of property from the plan to a registered retirement savings plan or a registered retirement income fund,
the following rules apply for the purposes of this Act:
(f)the individual is deemed not to have received an amount out of or under the registered pension plan as a consequence of acquiring the interest, and
(g)other than for the purposes of sections 147.1 and 147.3, any amount received at or after that time by any individual under the contract is deemed to have been received under the registered pension plan.
Marginal note:Amended contract
(2)Where
(a)an amendment is made at any time to an annuity contract to which subsection (1) or paragraph 254(a) applies, other than an amendment the sole effect of which is to
(i)defer annuity commencement to no later than the end of the calendar year in which the individual in respect of whom the contract was purchased attains 71 years of age, or
(ii)enhance benefits under the annuity contract in connection with the demutualization (as defined by subsection 139.1(1)) of an insurance corporation that is considered for the purpose of section 139.1 to have been a party to the annuity contract, and
(b)the rights provided for under the contract are materially altered as a consequence of the amendment,
the following rules apply for the purposes of this Act:
(c)each individual who has an interest in the contract immediately before that time is deemed to have received at that time the payment of an amount under a pension plan equal to the fair market value of the interest immediately before that time,
(d)the contract as amended is deemed to be a separate annuity contract issued at that time otherwise than pursuant to or under a superannuation or pension fund or plan, and
(e)each individual who has an interest in the separate annuity contract immediately after that time is deemed to have acquired the interest at that time at a cost equal to the fair market value of the interest immediately after that time.
Marginal note:New contract
(3)For the purposes of this Act, where an annuity contract (in this subsection referred to as the “original contract”) to which subsection 147.4(1) or paragraph 254(a) applies is, at any time, substituted by another contract,
(a)if the rights provided for under the other contract
(i)are not materially different from those provided for under the original contract, or
(ii)are materially different from those provided for under the original contract only because of an enhancement of benefits that can reasonably be considered to have been provided solely in connection with the demutualization (as defined by subsection 139.1(1)) of an insurance corporation that is considered for the purposes of section 139.1 to have been a party to the original contract,
the other contract is deemed to be the same contract as, and a continuation of, the original contract; and
(b)in any other case, each individual who has an interest in the original contract immediately before that time is deemed to have received at that time the payment of an amount under a pension plan equal to the fair market value of the interest immediately before that time.
(4)[Repealed, 2007, c. 29, s. 21]
Marginal note:Definitions
147.5(1)The following definitions apply in this section.
administrator, of a pooled pension plan, means
(a)a corporation resident in Canada that is responsible for the administration of the plan and that is authorized under thePooled Registered Pension Plans Actor a similar law of a province to act as an administrator for one or more pooled pension plans; or
(b)an entity designated in respect of the plan under section 21 of thePooled Registered Pension Plans Actor any provision of a law of a province that is similar to that section. (administrateur)
designated pooled pension plan, for a calendar year, means a pooled pension plan that, at any time in the year (other than the year in which the plan became registered as a PRPP), meets any of the following conditions:
(a)the plan has fewer than 10 participating employers;
(b)the fair market value of the property held in connection with the accounts of all members of the plan employed by a particular participating employer exceeds 50% of the fair market value of the property held in connection with the plan;
(c)more than 50% of the members of the plan are employed by a particular participating employer; or
(d)it is reasonable to conclude that the participation in the plan of one or more participating employers occurs primarily to avoid the application of any of paragraphs (a) to (c). (régime de pension collectif désigné)
exempt earned income, of a taxpayer for a taxation year, means the total of all amounts each of which is an amount that is
(a)not included in the taxpayer’s earned income (as defined in subsection 146(1)) for the year and that would be so included but for paragraph 81(1)(a) as it applies with respect to theIndian Act; and
(b)reported by the taxpayer in prescribed form filed with the Minister by the taxpayer’s filing-due date for the year, or such later date as is acceptable to the Minister, provided that the later date is within three calendar years following the end of the year. (revenu gagné exonéré)
exempt-income contribution amount, of a taxpayer for a taxation year, means the total of
(a)all amounts each of which is a contribution to a PRPP made by the taxpayer for the year that is not deductible in computing the income of the taxpayer because of subsection (32), and
(b)the amount, if any, designated under subsection (34) by the taxpayer for the year in prescribed form filed with the Minister by the taxpayer’s filing-due date for the year, or such later date as is acceptable to the Minister, provided that the later date is within three calendar years following the end of the year. (cotisation provenant du revenu exonéré)
member, of a pooled pension plan, means an individual (other than a trust) who holds an account under the plan. (participant)
participating employer, in relation to a pooled pension plan for a calendar year, means an employer that, in the year,
(a)makes contributions to the plan in respect of all or a class of its employees or former employees; or
(b)remits to the administrator of the plan contributions made by members of the plan under a contract with the administrator in respect of all or a class of its employees. (employeur participant)
pooled pension planmeans a plan that is registered under thePooled Registered Pension Plans Actor a similar law of a province. (régime de pension collectif)
pooled registered pension planorPRPPmeans a pooled pension plan that has been accepted for registration by the Minister for the purposes of this Act, which registration has not been revoked. (régime de pension agréé collectifouRPAC)
qualifying annuity, for an individual, means an annuity (other than an advanced life deferred annuity) that
(a)is payable to
(i)the individual for the individual’s life, or
(ii)the individual for the lives, jointly, of the individual and the individual’s spouse or common-law partner and to the survivor of them for the survivor’s life;
(b)is payable beginning no later than the later of
(i)the end of the calendar year in which the individual attains 71 years of age, and
(ii)the end of the calendar year in which the annuity is acquired;
(c)unless the annuity is subsequently commuted into a single payment, is payable
(i)at least annually, and
(ii)in equal amounts or is not so payable solely because of an adjustment that would, if the annuity were an annuity under a retirement savings plan, in accordance with any of subparagraphs 146(3)(b)(iii) to (v);
(d)if the annuity includes a guaranteed period, requires that
(i)the period not exceed 15 years, and
(ii)in the event of the later of the death of the individual and that of the individual’s spouse or common-law partner during the period, any remaining amounts otherwise payable be commuted into a single payment as soon as practicable after the later death; and
(e)does not permit any premiums to be paid, other than the premium paid from the PRPP to acquire the annuity. (rente admissible)
qualifying survivor, in relation to a member of a PRPP, means an individual who, immediately before the death of the member
(a)was a spouse or common-law partner of the member; or
(b)was a child or grandchild of the member who was financially dependent on the member for support. (survivant admissible)
restricted investment, for a pooled pension plan, means
(a)a debt of a member of the plan;
(b)a share of, an interest in, or a debt of
(i)a corporation, partnership or trust in which a member of the plan has a significant interest, or
(ii)a person or partnership that does not deal at arm’s length with the member of the plan or with a person or partnership described in subparagraph (i);
(c)an interest (or, for civil law, a right) in, or a right to acquire, a share, interest or debt described in paragraph (a) or (b); or
(d)prescribed property. (placement non admissible)
single amountmeans an amount that is not part of a series of periodic payments. (montant unique)
successor membermeans an individual who was the spouse or common-law partner of a member of a PRPP immediately before the death of the member and who acquires, as a consequence of the death, all of the member’s rights in respect of the member’s account under the PRPP. (participant remplaçant)
unused non-deductible PRPP room, of a taxpayer at the end of a taxation year, means the amount determined by the formula
A – B
where
Marginal note:Registration conditions
(2)The Minister may accept for registration a pooled pension plan for the purposes of this Act, but shall not accept for registration any plan unless application for registration is made in prescribed manner by the plan administrator and, in the Minister’s opinion, the plan complies with the following conditions:
(a)the primary purpose of the plan is to accept and invest contributions in order to provide retirement income to plan members, subject to the limits and other requirements under this Act;
(b)a single and separate account is maintained for each member under the member’s Social Insurance Number
(i)to which are credited all contributions made to the plan in respect of the member, and any earnings of the plan allocated to the member, and
(ii)to which are charged all payments and distributions made in respect of the member;
(c)the only benefits provided under the plan in respect of each member are benefits determined solely with reference to, and provided by, the amount in the member’s account;
(d)all earnings of the plan are allocated to plan members on a reasonable basis and no less frequently than annually;
(e)the arrangement under which property is held in connection with the plan is acceptable to the Minister;
(f)no right of a person under the plan is capable of being assigned, charged, anticipated, given as security or surrendered, other than
(i)an assignment pursuant to a decree, order or judgment of a competent tribunal, or under a written agreement, relating to a division of property between the member and the member’s spouse or common-law partner or former spouse or common-law partner, in settlement of rights arising out of, or on a breakdown of, their marriage or common-law partnership, or
(ii)an assignment by the legal representative of a deceased individual on the distribution of the individual’s estate;
(g)the plan requires that all amounts contributed or allocated to a member’s account vest immediately and indefeasibly for the benefit of the member;
(h)the plan permits the payment of an amount to a member if the amount is paid to reduce the amount of tax that would otherwise be payable under Part X.1 by the member;
(i)any amount payable from an account of a member after the death of the member is paid as soon as practicable after the death;
(j)there is no reason to expect that the plan may become a revocable plan; and
(k)any prescribed conditions.
Marginal note:Conditions applicable to PRPPs
(3)A pooled registered pension plan becomes a revocable plan at any time that
(a)a contribution is made to the plan other than an amount
(i)paid by a member of the plan,
(ii)paid by an employer or former employer of a member of the plan in respect of the member, or
(iii)transferred to the plan in accordance with any of subsections (21), 146(16) and (21), 146.3(14) and (14.1), 147(19) and 147.3(1), (4) and (5) to (7);
(b)a contribution is made to the plan in respect of a member after the calendar year in which the member attains 71 years of age, other than an amount
(i)described in subparagraph (a)(iii), or
(ii)if subsection 60.022(1) applies, described in any of subclauses 60(l)(v)(B.2)(II) to (IV) as read in that subsection;
(c)a participating employer makes contributions to the plan in a calendar year in respect of a member of the plan in excess of the RRSP dollar limit for the year, except in accordance with a direction by the member;
(d)a distribution is made from the plan other than
(i)a payment of benefits in accordance with subsection (5), or
(ii)a return of contributions
(A)if a contribution to the plan has been made as a result of a reasonable error by a member of the plan or a participating employer in relation to the plan and the return of contributions is made to the person who made the contribution no later than December 31 of the year following the calendar year in which the contribution was made,
(B)to avoid the revocation of the registration of the plan,
(C)to reduce the amount of tax that would otherwise be payable under Part X.1 by a member, or
(D)to comply with any requirement under this Act;
(e)property is held in connection with the plan that
(i)the administrator knew or ought to have known was a restricted investment for the plan, or
(ii)in the case of a designated pooled pension plan, is a share or debt of, or an interest in, a participating employer of the plan or any person or partnership that does not deal at arm’s length with a participating employer, or an interest (or, for civil law, a right) in, or a right to acquire, such a share, debt or interest;
(f)the value of a member’s right under the plan depends on the value of, or income or capital gains in respect of, property that would be described in paragraph (e) if it were held in connection with the plan;
(g)the administrator borrows money or other property for the purposes of the plan; or
(h)the plan or the administrator does not comply with a prescribed condition.
Marginal note:Non-payment of minimum amount
(4)A PRPP becomes a revocable plan at the beginning of a calendar year if the total amount distributed from a member’s account under the PRPP in the calendar year is less than the amount that would be the minimum amount for the calendar year under subsection 8506(5) of theIncome Tax Regulationsif the member’s account were an account under a money purchase provision of a registered pension plan.
Marginal note:Permissible benefits
(5)The following benefits may be provided under a pooled pension plan:
(a)the payment of benefits to a member that would be in accordance with paragraph 8506(1)(e.1) or (e.2) of theIncome Tax Regulationsif the benefits were provided under a money purchase provision of a registered pension plan; and
(b)the payment of a single amount from the member’s account.
Marginal note:Additional conditions
(6)The Minister may, at any time, impose reasonable conditions, in writing, applicable with respect to PRPPs, a class of PRPPs or a particular PRPP.
Marginal note:Acceptance of amendments
(7)The Minister shall not accept an amendment to a PRPP unless
(a)application for the acceptance is made in prescribed manner by the administrator of the PRPP; and
(b)the amendment and the PRPP as amended comply with the registration conditions specified in subsection (2).
Marginal note:Trust not taxable
(8)No tax is payable under this Part by a trust governed by a PRPP on its taxable income for a taxation year, except that, if at any time in the year, it carries on a business, tax is payable under this Part by the trust on the amount that would be its taxable income for the year if it had no income or losses from sources other than the business, and for this purpose,
(a)all capital gains and capital losses from the disposition of property held in connection with the business are deemed to be income or losses, as the case may be, from the business; and
(b)the trust’s income is to be computed without reference to subsections 104(6), (19) and (21).
Marginal note:Obligations of administrator
(9)The administrator of a PRPP shall exercise the care, diligence and skill of a reasonably prudent trustee to minimize the possibility that the registration of the PRPP may be revoked other than at the request of the administrator.
Marginal note:Employer contributions deductible
(10)There may be deducted in computing a taxpayer’s income for a taxation year, the total of all amounts each of which is a contribution made by the taxpayer in the year or within 120 days after the end of the year to a PRPP in respect of the taxpayer’s employees or former employees to the extent that the contribution
(a)was made in accordance with the PRPP as registered and in respect of periods before the end of the year; and
(b)was not deducted in computing the taxpayer’s income for a preceding taxation year.
Marginal note:Member contributions
(11)For the purposes of paragraphs 60(j), (j.1) and (l), section 146 (other than subsections (8.3) to (8.7)), paragraphs 146.01(3)(a) and 146.02(3)(a) and Parts X.1 and X.5, a contribution made to a PRPP by a member of a PRPP is deemed to be a premium paid by the member to an RRSP under which the member is the annuitant.
Marginal note:Member’s account
(12)For the purposes of paragraph 18(1)(u), subparagraph (a)(i) of the definitionexcluded right or interestin subsection 128.1(10), paragraph 146(8.2)(b), subsection 146(8.21), paragraphs 146(16)(a) and (b), subparagraph 146(21)(a)(i), paragraph (b) of the definitionexcluded premiumin subsection 146.01(1), paragraph (c) of the definitionexcluded premiumin subsection 146.02(1), subsections 146.3(14) and 147(19) to (21), section 147.3 and paragraphs 212(1)(j.1) and (m), and of regulations made under subsection 147.1(18), a member’s account under a PRPP is deemed to be a registered retirement savings plan under which the member is the annuitant.
Marginal note:Taxable amounts
(13)There shall be included in computing the income of a taxpayer for a taxation year
(a)if the taxpayer is a member of a PRPP, the total of all amounts each of which is a distribution made in the year from the member’s account under the PRPP, other than an amount that is
(i)included in computing the income of another taxpayer for the year under paragraph (b),
(ii)described in subsection (22), or
(iii)distributed after the death of the member;
(b)if the taxpayer is a participating employer in relation to a PRPP, the total of all amounts each of which is a return of contributions that is described in clause (3)(d)(ii)(A) and that is made to the taxpayer in the year.
Marginal note:Treatment on death — no successor member
(14)If a member of a PRPP dies and there is no successor member in respect of the deceased member’s account under the PRPP, an amount, equal to the amount by which the fair market value of all property held in connection with the account immediately before the death exceeds the total of all amounts distributed from the account that are described in subsection (16), is deemed to have been distributed from the account immediately before the death.
Marginal note:Treatment on death — successor member
(15)If a member of a PRPP dies and there is a successor member in respect of the deceased member’s account under the PRPP,
(a)the account ceases to be an account of the deceased member at the time of the death;
(b)the successor member is, after the time of the death, deemed to hold the account as a member of the PRPP; and
(c)the successor member is deemed to be a separate member in respect of any other account under the PRPP that the successor member holds.
Marginal note:Qualifying survivor
(16)If, as a consequence of the death of a member of a PRPP, an amount is distributed in a taxation year from the member’s account under the PRPP to, or on behalf of, a qualifying survivor of the member, the amount shall be included in computing the survivor’s income for the year, except to the extent that it is an amount described in subsection (22).
Marginal note:Deemed distribution to qualifying survivor
(17)If an amount is distributed at any time from a deceased member’s account under a PRPP to the member’s legal representative and a qualifying survivor of the member is entitled to all or a portion of the amount in full or partial satisfaction of the survivor’s rights as a beneficiary (as defined in subsection 108(1)) under the deceased’s estate, then, for the purposes of subsection (16), the amount or portion of the amount, as the case may be, is deemed to have been distributed at that time from the member’s account to the qualifying survivor (and not to the legal representative) to the extent that it is so designated jointly by the legal representative and the qualifying survivor in prescribed form filed with the Minister.
Marginal note:Post-death increase in value
(18)There shall be included in computing the income for a taxation year of a taxpayer who is not a qualifying survivor in relation to a member of a PRPP, the total of all amounts each of which is an amount determined by the formula
A – B
where
(a)the amount of the distribution, and
(b)the amount by which the fair market value of all property held in connection with the account immediately before the death exceeds the total of all amounts each of which is
(i)the value of B in respect of any prior distribution made from the account, or
(ii)an amount included under subsection (16) in computing the income of a qualifying survivor in relation to the member.
Marginal note:Post-death decrease in value
(19)There may be deducted in computing the income of a member of a PRPP for the taxation year in which the member dies, an amount not exceeding the amount determined, after all amounts payable from the member’s account under the PRPP have been distributed, by the formula
A – B
where
(a)included in the member’s income under subsection (13) because of the application of subsection (14),
(b)included in the income of another taxpayer under subsection (16) or (18), or
(c)transferred in accordance with subsection (21) in circumstances described in subparagraph (21)(b)(iii); and
Marginal note:Subsection (19) not applicable
(20)Except where the Minister has waived in writing the application of this subsection with respect to all or any portion of the amount determined in subsection (19) in respect of a member’s account under a PRPP, that subsection does not apply if the last distribution from the account was made after the end of the calendar year following the year in which the member died.
Marginal note:Transfer of amounts
(21)An amount is transferred from a member’s account under a PRPP in accordance with this subsection if the amount
(a)is a single amount;
(b)is transferred on behalf of an individual who
(i)is the member,
(ii)is a spouse or common-law partner or former spouse or common-law partner of the member and who is entitled to the amount under a decree, order or judgment of a competent tribunal, or under a written agreement, relating to a division of property between the member and the individual, in settlement of rights arising out of, or on a breakdown of, their marriage or common-law partnership, or
(iii)is entitled to the amount as a consequence of the death of the member and was a spouse or common-law partner of the member immediately before the death; and
(c)is transferred directly to
(i)the individual’s account under the PRPP,
(ii)another PRPP in respect of the individual,
(iii)a registered pension plan for the benefit of the individual,
(iv)a registered retirement savings plan or registered retirement income fund under which the individual is the annuitant,
(v)a licensed annuities provider to acquire a qualifying annuity for the individual, or
(vi)a licensed annuities provider to acquire an advanced life deferred annuity for the benefit of the member.
Marginal note:Taxation of transfers
(22)If subsection (21) applies to an amount transferred from a member’s account under a PRPP on behalf of an individual,
(a)the amount shall not, by reason only of that transfer, be included in computing the income of the individual; and
(b)no deduction may be made in respect of the amount in computing the income of any taxpayer.
Marginal note:Taxation of qualifying annuity
(23)If an amount is transferred in accordance with subsection (21) to acquire a qualifying annuity, there shall be included — under this section and not under any other provision of this Act — in computing an individual’s income for a taxation year any amount received by the individual during the year out of or under the annuity or as proceeds from a disposition in respect of the annuity.
Marginal note:Notice of intent
(24)The Minister may give notice (in subsections (25) and (26) referred to as a “notice of intent”) to an administrator of a PRPP in writing that the Minister intends to revoke the registration of the plan as a PRPP if
(a)the plan does not comply with the conditions for registration in subsection (2);
(b)the plan is not administered in accordance with the terms of the plan as registered;
(c)the plan becomes a revocable plan;
(d)a condition imposed under subsection (6) that applies with respect to the plan is not complied with; or
(e)registration of the plan under thePooled Registered Pension Plans Actor a similar law of a province is refused or revoked.
Marginal note:Date of revocation
(25)The notice of intent shall specify the date on which revocation of a PRPP is to be effective, which date shall not be earlier than the earliest date on which one of the events described in subsection (24) occurs.
Marginal note:Notice of revocation
(26)At any time after 30 days after the day on which the notice of intent is mailed to an administrator of a PRPP, the Minister may give notice (in this subsection and in subsection (27) referred to as a “notice of revocation”) in writing to the administrator that the registration of the PRPP is revoked as of the date specified in the notice of revocation and that date may not be earlier than the date specified in the notice of intent.
Marginal note:Revocation of registration
(27)If the Minister gives a notice of revocation to the administrator of a PRPP, the registration of the PRPP is revoked as of the date specified in the notice of revocation, unless the Federal Court of Appeal or a judge of that Court, on application made at any time before the determination of an appeal pursuant to subsection 172(3), orders otherwise.
Marginal note:Voluntary revocation
(28)If the administrator of a PRPP so requests in writing, the Minister may give notice in writing to the administrator that the registration of the PRPP is revoked as of a specified date and that date may not be earlier than the date specified in the administrator’s request.
Marginal note:Single employer
(29)For the purposes of the definitiondesignated pooled pension planin subsection (1), all employers that are related to each other are deemed to be a single employer and all the structural units of a trade union, including each local, branch, national and international unit, are deemed to be a single employer.
Marginal note:Significant interest
(30)For the purposes of the definitionrestricted investmentin subsection (1), a member of a pooled pension plan has a significant interest in a corporation, trust or partnership at any time if, at that time,
(a)in the case of a corporation, the member is a specified shareholder of the corporation; and
(b)in the case of a partnership or trust,
(i)the member is a specified unitholder of the partnership or the trust, as the case may be, or
(ii)the total fair market value of the member’s interests in the partnership or the trust, as the case may be, together with all interests in the partnership or the trust held by persons or partnerships with whom the member does not deal at arm’s length or is affiliated, is 10% or more of the fair market value of all interests in the partnership or the trust.
Marginal note:Contributions from exempt income
(31)Contributions may be made to a PRPP in respect of a member of the PRPP as if the member’s earned income (as defined in subsection 146(1)) for a taxation year included the member’s exempt earned income for the year.
Marginal note:Non-deductible contributions
(32)A contribution made by a member of a PRPP to the member’s account under the PRPP out of or from the member’s exempt earned income may not be deducted in computing the income of the member for any taxation year.
Marginal note:Contribution deemed not paid
(32.1)Where a member of a PRPP or a participating employer in relation to the PRPP has, at any time in a taxation year, received a distribution from the member’s account under the PRPP that is a return of a contribution described in clause 147.5(3)(d)(ii)(A) or (B), the contribution is deemed not to have been a contribution made by the member or the participating employer, as the case may be, to the PRPP to the extent that the contribution is not deducted in computing the taxpayer’s income for the year or a preceding taxation year.
Marginal note:Exempt contributions not over-contributions
(33)For the purposes of Part X.1 as it applies because of subsection (11) in respect of contributions made to a PRPP,
(a)an individual’s earned income (as defined in subsection 146(1)) for any taxation year after 2012 includes the individual’s exempt earned income for that year;
(b)an individual’s exempt-income contribution amount for any taxation year is deemed to have been deducted by the individual under subsection 146(5) in computing the individual’s income for that year; and
(c)the description of D in paragraph (b) of the definitionunused RRSP deduction roomin subsection 146(1) is to be read without reference to subparagraph (iv).
Marginal note:Designation of exempt-income contribution amount
(34)A taxpayer may designate an amount as the taxpayer’s exempt-income contribution amount for a taxation year if the amount designated does not exceed the lesser of
(a)the taxpayer’s unused non-deductible PRPP room at the end of the preceding taxation year, and
(b)the total of the taxpayer’s contributions as a member to a PRPP for the year (other than contributions to which subsection (32) applies).
Marginal note:Regulations — other
(35)The Governor in Council may make regulations
(a)prescribing conditions applicable to administrators;
(b)requiring administrators to file information returns respecting pooled pension plans;
(c)enabling the Minister to require any person to provide the Minister with information for the purposes and provisions of this Act relating to PRPPs; and
(d)generally to carry out the purposes and provisions of this Act relating to PRPPs.
Marginal note:Amounts included in computing policyholder’s income
148(1)There shall be included in computing the income for a taxation year of a policyholder in respect of the disposition of an interest in a life insurance policy, other than a policy that is or is issued pursuant to
(a)a registered pension fund or plan,
(b)a registered retirement savings plan,
(b.1)a registered retirement income fund,
(b.2)a TFSA,
(b.3)a pooled registered pension plan,
(b.4)a FHSA,
(c)an income-averaging annuity contract,
(d)a deferred profit sharing plan, or
(e)an annuity contract if
(i)the payment for the annuity contract was deductible under paragraph 60(l) in computing the policyholder’s income,
(i.1)the annuity contract is a qualifying trust annuity with respect to a taxpayer and the amount paid to acquire it was deductible under paragraph 60(l) in computing the taxpayer’s income, or
(ii)the policyholder acquired the annuity contract in circumstances to which subsection 146(21) applied,
the amount, if any, by which the proceeds of the disposition of the policyholder’s interest in the policy that the policyholder, beneficiary or assignee, as the case may be, became entitled to receive in the year exceeds the adjusted cost basis to the policyholder of that interest immediately before the disposition.
Marginal note:Amount included in computing taxpayer’s income
(1.1)There shall be included in computing the income for a taxation year of a taxpayer in respect of a disposition of an interest in a life insurance policy described in paragraph (e) of the definitiondispositionin subsection 148(9) the amount, if any, by which the amount of a payment described in paragraph (e) of that definition that the taxpayer became entitled to receive in the year exceeds the amount that would be the taxpayer’s adjusted cost basis of the taxpayer’s interest in the policy immediately before the disposition if, for the purposes of the definitionadjusted cost basisin subsection 148(9), the taxpayer were, in respect of that interest in the policy, the policyholder.
Marginal note:Deemed proceeds of disposition
(2)For the purposes of subsections 148(1) and 20(20) and the definitionadjusted cost basisin subsection 148(9)
(a)where at any time a policyholder becomes entitled to receive under a life insurance policy a particular amount as, on account of, in lieu of payment of or in satisfaction of, a policy dividend, the policyholder shall be deemed
(i)to have disposed of an interest in the policy at that time, and
(ii)to have become entitled to receive proceeds of the disposition equal to the amount, if any, by which
(A)the particular amount
exceeds
(B)the part of the particular amount applied immediately after that time to pay a premium under the policy or to repay a policy loan under the policy, as provided for under the terms and conditions of the policy;
(b)where in a taxation year a holder of an interest in, or a person whose life is insured or who is the annuitant under, a life insurance policy (other than an annuity contract or an exempt policy) last acquired after December 1, 1982 or an annuity contract (other than a life annuity contract, as defined by regulation, entered into before November 13, 1981 or a prescribed annuity contract) dies, the policyholder shall be deemed to have disposed of the policyholder’s interest in the policy or the contract, as the case may be, immediately before the death;
(c)where, as a consequence of a death, a disposition of an interest in a life insurance policy is deemed to have occurred under paragraph 148(2)(b), the policyholder immediately after the death shall be deemed to have acquired the interest at a cost equal to the accumulating fund in respect thereof, as determined in prescribed manner, immediately after the death;
(d)where at any time a life insurance policy last acquired after December 1, 1982, or a life insurance policy to which subsection 12.2(9) of theIncome Tax Act, chapter 148 of the Revised Statutes of Canada, 1952, applies by virtue of paragraph 12.2(9)(b) of that Act, ceases to be an exempt policy (otherwise than as a consequence of the death of an individual whose life is insured under the policy or at a time when that individual is totally and permanently disabled), the policyholder shall be deemed to have disposed of the policyholder’s interest in the policy at that time for proceeds of disposition equal to the accumulating fund with respect to the interest, as determined in prescribed manner, at that time and to have reacquired the interest immediately after that time at a cost equal to those proceeds; and
(e)a policyholder with an interest in a life insurance policy, issued after 2016, that gives rise to an entitlement (of the policyholder, beneficiary or assignee, as the case may be) to receive all or a portion of an excess described in subparagraph (iv) is deemed, at a particular time, to dispose of a part of the interest and to be entitled to receive proceeds of the disposition equal to that excess or portion, as the case may be, if
(i)the policy is an exempt policy,
(ii)abenefit on death(as defined in subsection 1401(3) of theIncome Tax Regulations) under acoverage(as defined in section 310 of theIncome Tax Regulationsfor the purposes of section 306 of theIncome Tax Regulations) under the policy is paid at the particular time,
(iii)the payment results in the termination of the coverage but not the policy, and
(iv)the amount of thefund value benefit(as defined in subsection 1401(3) of theIncome Tax Regulations) paid at the particular time in respect of the coverage exceeds the amount
(A)in the case where there is nopolicy anniversary(as defined in section 310 of theIncome Tax Regulations) before the date of death of the individual whose life is insured under the coverage, that would be determined — on the policy anniversary that is on or that first follows that date of death and as though the coverage were not terminated — in respect of the coverage under subclause (A)(I) of the description of B in subparagraph 306(4)(a)(iii) of theIncome Tax Regulations, and
(B)in any other case, that is determined — on the last policy anniversary before the date of the death of the individual whose life is insured under the coverage — in respect of the coverage under subclause (A)(I) of the description of B in subparagraph 306(4)(a)(iii) of theIncome Tax Regulationsas it applies for the purpose of subparagraph 306(1)(b)(ii) of theIncome Tax Regulations.
Marginal note:Special rules for certain policies
(3)For the purposes of this section, where all or any part of an insurer’s reserves for a life insurance policy vary in amount depending on the fair market value of a specified group of properties (in this subsection referred to as a “segregated fund”),
(a)in computing the adjusted cost basis of the policy,
(i)an amount paid by the policyholder or on the policyholder’s behalf as or on account of premiums under the policy or to acquire an interest in the policy shall, to the extent that the amount was used by the insurer to acquire property for the purposes of the segregated fund, be deemed not to have been so paid, and
(ii)any transfer of property by the insurer from the segregated fund that resulted in an increase in the portion of its reserves for the policy that do not vary with the fair market value of the segregated fund shall be deemed to have been a premium paid under the policy by the policyholder; and
(b)the proceeds of the disposition of an interest in the policy shall be deemed not to include the portion thereof, if any, payable out of the segregated fund.
Marginal note:Partial surrender — ACB prorated
(4)If a taxpayer disposes (other than because of paragraph (2)(a) or as described in paragraph (b) of the definitiondispositionin subsection (9)) of a part of the taxpayer’s interest in a life insurance policy (other than an annuity contract) last acquired after December 1, 1982 or an annuity contract, the adjusted cost basis to the taxpayer, immediately before the disposition, of the part is the amount determined by the formula
A × B/C
where
(a)if the policy is a policy (other than an annuity contract) issued after 2016, the amount determined by the formula
D – E
where
(b)in any other case, the accumulating fund with respect to the taxpayer’s interest, as determined in prescribed manner, immediately before the disposition.
Marginal note:Repayment of policy loan on partial surrender
(4.01)For the purposes of the definitionadjusted cost basisin subsection (9) and paragraph 60(s), a particular amount is deemed to be a repayment made immediately before a particular time by a taxpayer in respect of a policy loan in respect of a life insurance policy if
(a)the policy is issued after 2016;
(b)the taxpayer disposes of a part of the taxpayer’s interest in the policy at the particular time;
(c)paragraph (a) of the definitionproceeds of the dispositionin subsection (9) applies to determine the proceeds of the disposition of the interest;
(d)the particular amount is not
(i)otherwise a repayment by the taxpayer in respect of the policy loan, and
(ii)described in subparagraph (i) of the description of C in paragraph (a) of the definitionproceeds of the dispositionin subsection (9); and
(e)the amount payable by the taxpayer in respect of the policy loan is reduced by the particular amount as a consequence of the disposition.
Marginal note:10/8 policy surrender
(5)If a policyholder has after March 20, 2013 and before April 2014 disposed of an interest in a 10/8 policy because of a partial or complete surrender of the policy, the policyholder may deduct in computing their income for the taxation year in which the disposition occurs an amount that does not exceed the least of
(a)the portion of an amount, included under subsection (1) in computing their income for the year in respect of the disposition, that is attributable to an investment account described in paragraph (b) of the definition10/8 policyin subsection 248(1) in respect of the policy,
(b)the total of all amounts each of which is an amount, to the extent that the amount has not otherwise been included in determining an amount under this paragraph, of a payment made after March 20, 2013 and before April 2014 that reduces the amount outstanding of a borrowing or policy loan, as the case may be, described in paragraph (a) of the definition10/8 policyin subsection 248(1) in respect of the policy, and
(c)the total of all amounts each of which is an amount, to the extent that the amount has not otherwise been included in determining an amount under this paragraph, that the policyholder is entitled to receive as a result of the disposition and that is paid after March 20, 2013 and before April 2014 out of an investment account described in paragraph (b) of the definition10/8 policyin subsection 248(1) in respect of the policy.
Marginal note:Proceeds receivable as annuity
(6)Where, under the terms of a life insurance policy (other than an annuity contract) last acquired before December 2, 1982, a policyholder became entitled to receive from the insurer at any time before the death of the person whose life was insured thereunder, all the proceeds (other than policy dividends) payable at that time under the policy in the form of an annuity contract or annuity payments,
(a)the payments shall be regarded as annuity payments made under an annuity contract;
(b)the purchase price of the annuity contract shall be deemed to be the adjusted cost basis of the policy to the policyholder immediately before the first payment under that contract became payable; and
(c)the annuity contract or annuity payments shall be deemed not to be proceeds of the disposition of an interest in the policy.
Marginal note:Disposition at non-arm’s length and similar cases
(7)If an interest of a policyholder in a life insurance policy is, at any time (referred to in this subsection as thedisposition time), disposed of (other than a disposition under paragraph (2)(b)) by way of a gift, by distribution from a corporation or by operation of law only to any person, or in any manner whatever to any person with whom the policyholder was not dealing at arm’s length,
(a)the policyholder is deemed to become entitled to receive, at the disposition time, proceeds of the disposition equal to the greatest of
(i)the value of the interest at the disposition time,
(ii)an amount equal to
(A)if the disposition time is before March 22, 2016, nil, and
(B)if the disposition time is after March 21, 2016, the fair market value at the disposition time of the consideration, if any, given for the interest, and
(iii)an amount equal to
(A)if the disposition time is before March 22, 2016, nil, and
(B)if the disposition time is after March 21, 2016, the adjusted cost basis to the policyholder of the interest immediately before the disposition time;
(b)the person that acquires the interest because of the disposition is deemed to acquire it, at the disposition time, at a cost equal to the amount determined under paragraph (a) in respect of the disposition;
(c)in computing the paid-up capital in respect of each class of shares of the capital stock of a corporation at any time at or after the disposition time there shall be deducted the amount determined by the formula
(A − B × C/D) × E/A
where
(i)if consideration is given for the interest, the fair market value at the disposition time of consideration that is shares of the capital stock of the corporation given for the interest, and
(ii)if no consideration is given for the interest, 1,
(i)if consideration is given for the interest, the fair market value at the disposition time of the consideration given for the interest, and
(ii)if no consideration is given for the interest, 1, and
(d)any contribution of capital to a corporation or partnership in connection with the disposition is deemed, to the extent that it exceeds the amount determined under subparagraph (a)(i) in respect of the disposition, not to result in a contribution of capital for the purpose of applying paragraphs 53(1)(c) and (e) at or after the disposition time;
(e)any contributed surplus of a corporation that arose in connection with the disposition is deemed, to the extent that it exceeds the amount determined under subparagraph (a)(i) in respect of the disposition, not to be contributed surplus for the purpose of applying subsection 84(1) at or after the disposition time; and
(f)if the disposition time is before March 22, 2016,
(i)subparagraphs (ii) and (iii) and paragraphs (c) to (e) apply in respect of the disposition only if the disposition is after 1999 and at least one person whose life was insured under the policy before March 22, 2016 is alive on March 22, 2016,
(ii)in applying paragraphs (c) to (e) in respect of the disposition, a reference in those paragraphs to “the disposition time” is to be read as “the beginning of March 22, 2016”,
(iii)if at any time (referred to in this subparagraph as theconversion time) before March 22, 2016 the paid-up capital of a class of shares of the capital stock of a corporation was increased, the increase occurred as a result of any action by which the corporation converted any of its contributed surplus into paid-up capital in respect of the class of shares, the contributed surplus arose in connection with the disposition, and subsection 84(1) did not apply to deem the corporation to pay a dividend at the conversion time in respect of the increase, in computing the paid-up capital in respect of that class of shares after March 21, 2016, there shall be deducted the amount determined by the formula
(A − B × A/D) × C/A
where
(iv)if any consideration given for the interest includes a share of the capital stock of a corporation, the share (or a share substituted for the share) is disposed of (referred to in this subparagraph as theshare disposition) after March 21, 2016 by a taxpayer and subsection 84.1(1) applies in respect of the share disposition, then for the purposes of applying section 84.1, the adjusted cost base to the taxpayer of the share immediately before the share disposition is to be reduced by the amount determined by the formula
(A − B x A/C)/D
where
Marginal note:Idem
(8)Notwithstanding any other provision in this section, where
(a)an interest of a policyholder in a life insurance policy (other than an annuity contract) has been transferred to the policyholder’s child for no consideration, and
(b)a child of the policyholder or a child of the transferee is the person whose life is insured under the policy,
the interest shall be deemed to have been disposed of by the policyholder for proceeds of the disposition equal to the adjusted cost basis to the policyholder of the interest immediately before the transfer, and to have been acquired by the person who acquired the interest at a cost equal to those proceeds.
Marginal note:Inter vivos transfer to spouse
(8.1)Notwithstanding any other provision of this section, where
(a)an interest of a policyholder in a life insurance policy (other than a policy that is, or is issued under, a plan or contract referred to in any of paragraphs 148(1)(a) to 148(1)(e)) is transferred to
(i)the policyholder’s spouse or common-law partner, or
(ii)a former spouse or common-law partner of the policyholder in settlement of rights arising out of their marriage or common-law partnership, and
(iii)[Repealed, 1994, c. 7, Sch