14 June 1995 External T.I. 9509985 - CAN DEPOSIT AGENT RECEIVE RRSP FUNDS

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues:

Can a RRSP be transferred from one issuer to the "deposit agent" for a second issuer?

Position TAKEN:

Yes and No

Reasons FOR POSITION TAKEN:

In the situation where a principal/agency relationship does, in fact, exist between the issuer and a third party then the third party may be a transferee for the purposes of paragraph 146(16)(a). However, such a determination is a question of fact and, in the present situation, there were insufficient facts to make such a determination.

		950998
XXXXXXXXXX	M.P. Sarazin

Attention: XXXXXXXXXX

June 14, 1995

Dear Sirs:

Re: Transfer of Registered Retirement Savings Plan ("RRSP")

This is in reply to your letter dated March 27, 1995 wherein you requested our comments as to whether paragraph 146(16)(a) of the Income Tax Act would apply where an annuitant decides to transfer property from an RRSP before the plan matures to another RRSP for the same annuitant and the transferor issuer forwards the property held in the RRSP to a broker who is a "deposit agent" for the transferee issuer.

Comments

An annuitant under an RRSP may transfer part or all of the RRSP property to another RRSP for the same annuitant pursuant to paragraph 146(16)(a) of the Act. A plan must qualify as a retirement savings plan ("RSP") within the meaning assigned by subsection 146(1) of the Act before the plan will be accepted by the Minister for registration for purposes of the Act. In order to qualify as a RSP, there must be a payment to an issuer of the plan that would meet the conditions of subparagraph 146(1)(b)(i), (ii) or (iii) of the definition of "retirement savings plan". Consequently, we are of the view that the transferor issuer would have to transfer the RRSP property directly to the transferee issuer in order to qualify under paragraph 146(16)(a) of the Act.

This position is confirmed in paragraph 27 of Information Circular 72-22R8 wherein it states:

"Direct transfers of all or part of the property from an unmatured RRSP to the issuer of another RRSP, ..., should be recorded on Form T2033."

We trust the above comments will be of assistance to you.

Yours truly,

for Director
Financial Industries Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch