Department of Finance Canada
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LEGISLATIVE PROPOSALS RELATING TO POOLED REGISTERED
PENSION PLANS
Income Tax Act
1. (1) Subparagraph
6(1)(a)(i) of the Income Tax Act is replaced by
the following:
(i) derived from the
contributions of the taxpayer’s employer to or under a deferred profit sharing
plan, an employee life and health trust, a group sickness or accident insurance
plan, a group term life insurance policy, a pooled registered pension plan, a
private health services plan, a registered pension plan or a supplementary
unemployment benefit plan,
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
2. (1) The
portion of paragraph 18(11)(c) of the
Act before subparagraph (i) is replaced by the following:
(c) making a
contribution to a deferred profit sharing plan, a pooled registered pension plan or a
registered pension plan, other than
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
3. (1) Paragraph
20(1)(q) of the Act is replaced by the
following:
Employer’s contributions to RPP or
PRPP
(q) such amount in
respect of employer contributions to registered pension plans or pooled registered pension plans as
is permitted under subsection
147.2(1) or
147.5(10);
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
4. (1) Subsection
56(1) of the Act is amended by striking out “and” at the end of paragraph (z.1), by adding “and” at the end of paragraph
(z.2) and by adding the following after
paragraph (z.2):
Pooled
registered pension plan
(z.3) any amount
required by section 147.5 to be included in computing the taxpayer’s income for
the year.
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
5. (1) Sub-subclause
60(l)(v)(B.1)(II)1 of the Act is
replaced by the following:
1. a payment (other than a
payment that is part of a series of periodic payments or that relates to an
actuarial surplus) received by the taxpayer out of or under a pooled registered pension plan, a
registered pension plan or a specified pension plan,
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
6. (1) The
definition “eligible individual” in subsection
60.02(1) of the Act is replaced by the following:
“eligible
individual”
« particulier admissible
»
“eligible individual” means a child or grandchild of a deceased annuitant
under a registered retirement savings plan or a registered retirement income
fund, or of a deceased member of a
pooled registered pension plan, a registered pension plan or a specified
pension plan, who was financially dependent on the deceased for support, at the
time of the deceased’s death, by reason of mental or physical infirmity.
(2) Paragraph (c) of the definition “eligible proceeds” in subsection 60.02(1) of the Act
is replaced by the following:
(c) a payment (other
than a payment that is part of a series of periodic payments or that relates to
an actuarial surplus) out of or under a
pooled registered pension plan, a registered pension plan or a specified
pension plan.
(3) Subsections
(1) and (2) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
7. (1) Paragraph
75(3)(a) of the Act is replaced by the
following:
(a) by a trust governed
by a deferred profit sharing plan, an employee benefit plan, an employees profit
sharing plan, a pooled registered
pension plan, a registered disability savings plan, a registered
education savings plan, a registered pension plan, a registered retirement
income fund, a registered retirement savings plan, a registered supplementary
unemployment benefit plan, a retirement compensation arrangement or a
TFSA;
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
8. (1) Paragraph
(a) of the definition “trust” in subsection 108(1) of the Act is replaced
by the following:
(a) an amateur athlete
trust, an employee life and health trust, an employee trust, a trust described
in paragraph 149(1)(o.4) or a trust
governed by a deferred profit sharing plan, an employee benefit plan, an
employees profit sharing plan, a foreign retirement arrangement, a pooled registered pension plan, a
registered disability savings plan, a registered education savings plan, a
registered pension plan, a registered retirement income fund, a registered
retirement savings plan, a registered supplementary unemployment benefit plan or
a TFSA,
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
9. (1) Subparagraph
(a)(i) of the definition “pension income” in subsection 118(7) of the Act is
replaced by the following:
(i) a payment in respect of a
life annuity out of or under a superannuation or pension plan (other than a pooled registered pension
plan) or a specified pension plan,
(2) Paragraph (a) of the definition “pension income” in subsection 118(7) of the Act is
amended by adding the following before subparagraph (iv):
(iii.2) included
under section 147.5,
(3) Subsections
(1) and (2) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
10. (1) The
description of D in the definition “unused RRSP
deduction room” in subsection 146(1) of the Act is replaced by the
following:
D is the total of all amounts each of which
is
(i) an amount deducted by the
taxpayer under subsection (5) or (5.1), in computing the taxpayer’s income for
the year,
(ii) an amount deducted by the taxpayer
under paragraph 10 of Article XVIII of the Canada-United States Tax
Convention signed at Washington on September 26, 1980 or a similar
provision in another tax treaty, in computing the taxpayer’s taxable income for
the year, or
(iii) a
contribution made by an employer in the year to a pooled registered pension plan
in respect of the taxpayer, and
(2) The portion of
subsection 146(1.1) of the Act before the formula is replaced by the
following:
Restriction — financially
dependent
(1.1) For the purposes of paragraph (b) of the definition “refund of premiums” in subsection (1), clause
60(l)(v)(B.01), the definition “eligible individual” in subsection 60.02(1),
subparagraph 104(27)(e)(i) and section 147.5, it is assumed, unless
the contrary is established, that an individual’s child or grandchild was not
financially dependent on the individual for support immediately before the
individual’s death if the income of the child or grandchild for the taxation
year preceding the taxation year in which the individual died exceeded the
amount determined by the formula
(3) Paragraph
146(5)(b) of the Act is replaced by the
following:
(b) the amount, if any, by which the
taxpayer’s RRSP deduction limit for the year exceeds the total of all contributions made by
an employer in the year to a pooled registered pension plan in respect of the
taxpayer.
(4) Subparagraph
146(8.2)(b)(iii) of the Act is replaced
by the following:
(iii) was not paid by way of
a transfer of an amount to a registered retirement savings plan
from
(A) a pooled registered pension plan in
circumstances to which subsection 147.5(20) applied, or
(B) a specified pension plan
in circumstances to which subsection (21) applied,
(5) Subsection
146(21.2) of the Act is replaced by the following:
Specified pension plan —
account
(21.2) For the purposes of
paragraph (8.2)(b), subsection (8.21),
paragraphs (16)(a) and (b) and 18(1)(u), subparagraph (a)(i) of the definition “excluded right or interest” in subsection 128.1(10),
paragraph (b) of the definition “excluded premium” in subsection 146.01(1),
paragraph (c) of the definition “excluded premium” in subsection 146.02(1),
subsections 146.3(14) and 147(19), section 147.3 and paragraph 147.5(20)(c), and for the purposes of any
regulations made under subsection 147.1(18), an individual’s account under a
specified pension plan is deemed to be a registered retirement savings plan
under which the individual is the annuitant.
(6) Subsections
(1) to (5) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
11. (1) Paragraph
146.3(2)(f) of the Act is amended by
striking out “or” at the end of subparagraph (vi), by adding “or” at the end of
subparagraph (vii) and by adding the following after subparagraph
(vii):
(viii) a
pooled registered pension plan in accordance with subsection
147.5(20);
(2) Subsection
146.3(14.1) of the Act is replaced by the following:
Transfer to PRPP or RPP
(14.1) An amount is
transferred from a registered retirement income fund of an annuitant in
accordance with this subsection if the amount
(a) is transferred at
the direction of the annuitant directly to an account of the annuitant under a
pooled registered pension plan; or
(b) is transferred at
the direction of the annuitant directly to a registered pension plan of which,
at any time before the transfer, the annuitant was a member (within the meaning
assigned by subsection 147.1(1)) or to a prescribed registered pension plan and
is allocated to the annuitant under a money purchase provision (within the
meaning assigned by subsection 147.1(1)) of the plan.
(3) Subsections
(1) and (2) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
12. (1) The
Act is amended by adding the following after section 147.4:
Pooled Registered Pension
Plans
Definitions
147.5 (1) The
following definitions apply in this section.
“administrator”
«
administrateur »
“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 the Pooled Registered Pension Plans
Act or 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 the Pooled Registered Pension Plans
Act or any provision of a law of a province that is similar to that
section.
“designated
pooled pension plan”
« régime
de pension collectif désigné »
“designated
pooled pension plan”, for a calendar year,
means a pooled pension plan if at any time in the year (other than the year in
which the plan became registered as a PRPP)
(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).
“excluded
investment”
«
placement exclu »
“excluded
investment”
means a debt of Her Majesty in right of Canada or a province or of a
municipality in Canada.
“member”
«
participant »
“member”, of a pooled pension
plan, means an individual (other than a trust) who holds an account under the
plan.
“participating
employer”
«
employeur 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.
“pooled
pension plan”
« régime
de pension collectif »
“pooled
pension plan”
means a plan that is registered under the Pooled Registered Pension Plan
Act or a similar law of a province.
“pooled
registered pension plan” or “PRPP”
« régime
de pension agréé collectif » ou « RPAC »
“pooled
registered pension plan” or “PRPP” means a pooled pension
plan that has been accepted for registration by the Minister for purposes of
this Act, which registration has not been revoked.
“qualifying
annuity”
« rente
admissible »
“qualifying
annuity”, for
an individual, means an 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 the end of the calendar year in which the
individual attains 71 years of age and the 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, be 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.
“qualifying
survivor”
«
survivant 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.
“restricted
investment”
«
placement non 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.
“single
amount”
« montant
unique »
“single
amount” means
an amount that is not part of a series of periodic payments.
“successor
member”
«
participant remplacant »
“successor
member” means
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.
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
(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) all property held
in connection with the plan is held in trust by the administrator for the
members of the plan;
(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 a
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 where 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.
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 (20), 146(16), 146.3(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 described in subparagraph
(a)(iii);
(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 made to avoid the revocation of the registration of the
plan, to reduce the amount of tax that would otherwise be payable under Part X.1
by a member or 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 administrator
has not taken reasonable precautions to avoid holding, in connection with the
plan, properties (other than excluded investments) that are shares or debts of,
or interests in a non-arm’s length group (or interests — or, for civil law,
rights — in, or rights to acquire, such shares, debts or interests), the total
fair market value of which properties is 10% or more of the total fair market
value of all property held in connection with the plan, and, for this purpose, a
non-arm’s length group is a particular person or partnership together with any
other person or partnership that does not deal at arm’s length or is affiliated
with the particular person or partnership;
(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.
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 the Income Tax Regulations if the
member’s account were an account under a money purchase provision of a
registered pension plan.
Permissible
benefits
(5) The
following benefits may be provided under a pooled pension plan:
(a) the payment of
benefits (in this section referred to as “variable benefits”) to a member that
would be in accordance with paragraph 8506(1)(e.1) of the Income Tax Regulations if 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.
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.
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).
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).
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.
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.
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 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.
Member’s
account
(12) For
the purposes of paragraph 18(1)(u),
subparagraph (a)(i) of the definition
“excluded right or interest” in
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 definition “excluded premium” in subsection 146.01(1), paragraph
(c) of the definition “excluded premium” in subsection 146.02(1),
subsections 146.3(14) and 147(19) and section 147.3, and of regulations made
under 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.
Taxable
amounts
(13)
There shall be included in computing the income of a member of a PRPP for a
taxation year 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
described in subsection (21) or distributed after the death of the
member.
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.
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.
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, 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 (21).
Post-death
increase in value
(17) 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 is the amount of a
distribution made in the year from the member’s account under the PRPP as a
consequence of the member’s death to, or on behalf of, the taxpayer,
and
B is an amount
designated by the administrator of the PRPP not exceeding the lesser
of
(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
the value of B in respect of any other distribution made from the
account.
Post-death
decrease in value
(18)
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 is the total of all
amounts each of which is an amount in respect of the account
(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 (17), or
(c) transferred in
accordance with subsection (20) in circumstances described in subparagraph
(20)(b)(iii); and
B is the total of all
distributions made from the account after the member’s death.
Subsection
(18) not applicable
(19) 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 (18) 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.
Transfer
of amounts
(20) 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
immediately before the death,
(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 because of mental or physical infirmity; 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, or
(v) a
licensed annuities provider to acquire a qualifying annuity for the
individual.
Taxation
of transfers
(21) If
subsection (20) 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 under any provision of this Act in respect of the amount in computing the
income of any taxpayer.
Taxation
of qualifying annuity
(22) If
an amount is transferred in accordance with subsection (20) 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.
Notice of
intent
(23) The
Minister may give notice (in subsections (24) and (25) 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 the Pooled
Registered Pension Plans Act or a similar law of a province is refused or
revoked.
Date of
revocation
(24) 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 (23) occurs.
Notice of
revocation
(25) At
any time after 30 days after the day of mailing of the notice of intent to an
administrator of a PRPP, the Minister may give notice (in this subsection and in
subsection (26) 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, which date may not be earlier than the
date specified in the notice of intent.
Revocation
of registration
(26) 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.
Voluntary
revocation
(27) 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, which date may not be earlier than the date specified in
the administrator’s request.
Single
employer
(28) For
the purposes of the definition “designated
pooled pension plan” in 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.
Significant
interest
(29) For
the purposes of the definition “restricted
investment” in 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.
Regulations
— other
(30) 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.
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled
Registered Pension Plans Act.
13. (1) Subsection
149(1) of the Act is amended by adding the following after paragraph (u.2):
PRPP
(u.3) a trust governed
by a pooled registered pension plan to the extent provided under section
147.5;
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
14. (1) Paragraph
152(6)(f.3) of the Act is replaced by
following:
(f.3) a deduction
(including for the purposes of this subsection a reduction of an amount
otherwise required to be included in computing a taxpayer’s income) under
subsection 146(8.9) or (8.92), 146.3(6.2) or (6.3) or 147.5(14) or (18),
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
15. (1) Subsection
172(3) of the Act is amended by striking out “or” at the end paragraph (f.1) and by adding the following after
paragraph (g):
(h) refuses to accept
for registration for the purposes of this Act any pooled pension plan or gives
notice under subsection 147.5(22) to the administrator of a pooled registered
pension plan that the Minister proposes to revoke its registration, or
(i) refuses to accept
an amendment to a pooled registered pension plan,
(2) The portion of
subsection 172(3) of the Act, as amended by subsection (1), after paragraph
(i) is replaced by the
following:
the person described in paragraph (a), (a.1) or (a.2), the applicant in a case described in
paragraph (b), (e) or (g), a trustee under the plan or an employer of
employees who are beneficiaries under the plan, in a case described in paragraph
(c), the promoter in a case described in
paragraph (e.1), the administrator of
the plan or an employer who participates in the plan, in a case described in
paragraph (f) or (f.1), or the administrator of the plan in a case
described in paragraph (h) or (i), may appeal from the Minister’s
decision, or from the giving of the notice by the Minister, to the Federal Court
of Appeal.
(3) Paragraphs
172(5)(a) and (b) of the Act are replaced by the
following:
(a) to register for the
purposes of this Act any pension plan or
pooled pension plan, or
(b) to accept an
amendment to a registered pension plan or a pooled registered pension
plan
(4) Subsections
(1) to (3) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
16. (1) Subsection
180(1) of the Act is amended by striking out “or” at the end paragraph (c.1) and by replacing paragraph (d) with the following:
(c.2) the mailing of notice to the administrator of
the pooled registered pension plan under subsection 147.5(23),
or
(d) the time the
decision of the Minister to refuse the application for acceptance of the
amendment to the registered pension plan or pooled registered pension plan was
mailed, or otherwise communicated in writing, by the Minister to any
person,
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
17. (1) The
description of D in paragraph 204.2(1.1)(b) of the Act is replaced by the
following:
D is the group plan amount in respect of the
individual at that time,
(2) Subparagraph
(a)(iii) of the description of I in
subsection 204.2(1.2) of the Act is replaced by the following:
(iii) an amount transferred
to the plan on behalf of the individual in accordance with any of subsections
146(16), 147(19), 147.3(1) and (4) to (7) and 147.5(20) or in circumstances to which
subsection 146(21) applies,
(3) The description
of I in subsection 204.2(1.2) of the Act is amended by striking out “or” at the
end of paragraph (a), by replacing “and”
at the end of paragraph (b) with “or”
and by adding the following after paragraph (b):
(c) an amount
contributed in the year and before that time by an employer or former employer
of the individual to an account of the individual under a pooled registered
pension plan, and
(4) Paragraph (a) of the description of J in subsection
204.2(1.2) of the Act is replaced by following:
(a) the total of all
amounts each of which is an amount (other than the portion thereof that reduces
the amount on which tax is payable by the individual under subsection 204.1(1))
received by the individual in the year and before that time out of or under
a pooled registered pension plan,
a registered retirement savings plan or a registered retirement income fund and
included in computing the individual’s income for the year
(5) The portion of
subsection 204.2(1.3) of the Act before paragraph (a) is replaced by the following:
Group plan amount
(1.3) For the purposes of
this section, the group plan
amount in respect of an individual at any time in a taxation year is the lesser
of
(6) Subparagraph (i)
of the description F in paragraph 204.2(1.3)(a) of the Act is replaced by the
following:
(i) the total of all amounts
each of which is a qualifying group plan
amount in respect of the individual, to the extent that the amount is included in determining the
value of I in subsection (1.2) in respect of the individual at that time,
and
(7) Subparagraph (ii)
of the description K in paragraph 204.2(1.3)(a) of the Act is replaced by the
following:
(ii) in any other case, the
group plan amount in respect of
the individual at the end of the preceding taxation year, and
(8) Subsection
204.2(1.31) of the Act is replaced by the following:
Qualifying group plan
amount
(1.31) For the purposes of the description of F in
paragraph (1.3)(a), a qualifying group
plan amount in respect of an
individual is a premium paid under a registered retirement savings plan or an amount contributed by an employer or
former employer of the individual to an account of the individual under a pooled
registered pension plan if
(a) the plan is part of
a qualifying arrangement or is a pooled
registered pension plan,
(b) the premium or contribution is an amount to which
the individual is entitled for services rendered by the individual (whether or
not as an employee), and
(c) the premium or contribution was remitted to the
plan on behalf of the individual by the person or body of persons that is
required to remunerate the individual for the services, or by an agent for that
person or body,
but
does not include the part, if any, of a premium or contribution that, by making (or
failing to make) an election or exercising (or failing to exercise) any other
right under the plan after
beginning to participate in the plan and within 12 months before the
time the premium was paid or the
contribution was made, the individual could have prevented the premium or contribution and that
would not as a consequence have been required to be remitted on behalf of the
individual to another registered retirement savings plan or pooled registered pension plan or to
a money purchase provision of a
registered pension plan.
(9) Section 204.2 of
the Act is amended by adding the following after subsection (4):
PRPP
withdrawals
(5) Notwithstanding
the Pooled Registered Pension
Plans Act or any similar law of a province, a member of a PRPP may
withdraw an amount from the member’s account under the PRPP to reduce the amount
of tax that would otherwise be payable by the member under this Part, to the
extent that the reduction cannot be achieved by withdrawals from plans other
than PRPPs.
(10) Subsections
(1) to (9) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
18. (1) Paragraph
212(1)(h) of the Act is amended by
adding the following before subparagraph (iii):
(ii) an amount distributed
from a pooled registered pension plan that has been designated by the
administrator of the plan in accordance with subsection 147.5(17),
(2) The portion of
subparagraph 212(1)(h)(iii.1) of the Act
before clause (B) is replaced by the following:
(iii.1) the portion of the
payment that is transferred by the payer on behalf of the non-resident person,
pursuant to an authorization in prescribed form, to a pooled registered pension plan,
registered pension plan, registered retirement savings plan or registered
retirement income fund and that
(A) because of any of subsections 146(21), 147.3(9)
and 147.5(21) would not, if the
non-resident person had been resident in Canada throughout the taxation year in
which the payment was made, be included in computing the non-resident person’s
income, or
(3) Subsections
(1) and (2) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
19. (1) Subparagraph
241(4)(d)(vii) of the Act is replaced by
the following:
(vii) to an official solely
for the purposes of the administration or enforcement of the Pension Benefits Standards Act,
1985, the Pooled
Registered Pension Plans Act or a similar law of a province,
(2) Paragraph (b) of the definition “official” in subsection 241(10) of the Act is
replaced by the following:
(b) an authority
engaged in administering a law of a province similar to the Pension Benefits Standards Act,
1985 or the Pooled
Registered Pension Plans Act,
(3) Subsections
(1) and (2) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
20. (1) The
definition “registered pension plan” in
subsection 248(1) of the Act is replaced by the following:
“registered pension
plan”
« régime de pension agréé
»
“registered pension plan” means a pension plan (other than a pooled pension plan) that
has been registered by the Minister for the purposes of this Act , which
registration has not been revoked;
(2) The definition
“retirement compensation arrangement” in
subsection 248(1) of the Act is amended by adding the following after paragraph
(a):
(a.1) a pooled
registered pension plan,
(3) The definition
“salary deferral arrangement” in subsection
248(1) of the Act is amended by adding the following after paragraph (a):
(a.1) a pooled
registered pension plan,
(4) The portion of
the definition “superannuation or pension
benefit” in subsection 248(1) of the Act before paragraph (a) is replaced by the following:
“superannuation or
pension benefit”
« prestation de retraite ou de
pension »
“superannuation or pension
benefit” includes any amount received
out of or under a superannuation or pension fund or plan (including, except for the purposes of
subparagraph 56(1)(a)(i), a pooled registered pension plan)
and, without restricting the generality of the foregoing, includes any payment
made to a beneficiary under the fund or plan or to an employer or former
employer of the beneficiary thereunder
(5) Subsection 248(1)
of the Act is amended by adding the following in alphabetical
order:
“pooled
registered pension plan” or “PRPP”
« régime
de pension agréé collectif » ou « RPAC »
“pooled
registered pension plan” or “PRPP” has the meaning assigned
by subsection 147.5(1);
“specified
unitholder”
«
détenteur d’unité déterminé »
“specified
unitholder”,
of a partnership or trust (referred to in this definition as the “entity”), the
interests in which are described by reference to units, means a taxpayer who
would be a specified shareholder of the entity if the entity were a corporation
and each unit of the entity were a share of a class of the corporation having
the same attributes as the unit;
(6) Subsections
(1) to (5) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
21. (1) Section
253.1 of the Act is replaced by the following:
Investments in limited
partnerships
253.1 For the purposes of subparagraph 108(2)(b)(ii), paragraphs 130.1(6)(b), 131(8)(b), 132(6)(b) and 146.1(2.1)(c), subsection 146.2(6), paragraph 146.4(5)(b), subsection 147.5(8), paragraph 149(1)(o.2), the definition “private holding corporation” in subsection 191(1)
and regulations made for the purposes of paragraphs 149(1)(o.3) and (o.4), if a trust or corporation holds an
interest as a member of a partnership and, by operation of any law governing the
arrangement in respect of the partnership, the liability of the member as a
member of the partnership is limited, the member shall not, solely because of
its acquisition and holding of that interest, be considered to carry on any
business or other activity of the partnership.
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
22. (1) The
definition “specified taxpayer” in subsection
259(5) of the Act is replaced by the following:
“specified
taxpayer”
« contribuable déterminé
»
“specified taxpayer” means a taxpayer that is a registered investment or
that is described in any of paragraphs 149(1)(r), (s), (u) to (u.3) and (x).
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
Income Tax
Regulations
23. (1) Paragraph
(b) of the definition “remuneration” in subsection 100(1) of the Income Tax Regulations is replaced by
the following:
(b) a superannuation or
pension benefit (including an annuity payment made pursuant to or under a
superannuation or pension fund or plan) other than a distribution
(i) that
is made from a pooled registered pension plan and is not required to be included
in computing a taxpayer’s income under paragraph 56(1)(z.3) of the Act, or
(ii) that
is deemed to have been made under subsection 147.5(14) of the Act,
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
24. (1) The
Regulations are amended by adding the following after section 212:
Pooled
registered pension plans
213. An administrator of a PRPP
must file with the Minister an information return for each calendar year in
prescribed form in respect of the PRPP on or before May 1 of the following
calendar year.
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
25. (1) Subsection
4802(1) of the Regulations is amended by adding the following after paragraph
(c.2):
(c.3) a pooled
registered pension plan;
(2) Paragraph
4802(1.1)(e) of the Regulations is
replaced by the following:
(e) each of the
beneficiaries of the trust was a trust governed by a deferred profit sharing
plan, a pooled registered pension
plan or a registered pension plan.
(3) Subsections
(1) and (2) come into force or are deemed to have come into force on the day of
the coming into force of the Pooled Registered Pension Plans
Act.
26. (1) Subparagraph
8502(b)(iv) of the Regulations is
replaced by the following:
(i) is transferred to the
plan in accordance with any of subsections 146(16), 146.3(14.1), 147(19),
147.3(1) to (8) and 147.5(20) of
the Act, or
(2) Subsection
(1) comes into force or is deemed to have come into force on the day of the
coming into force of the Pooled Registered Pension Plans
Act.
