CRA indicates that an employer and employee can agree, on or before termination of employment, to defer a retiring allowance for a year or years

Respecting a terminated employee electing to receive a retiring allowance in the subsequent calendar year, CRA referred to its position in Folio S2-F1-C2 that an employee can choose, on or before termination of employment, to receive a lump sum in instalments, thereby deferring income recognition under s. 56(1)(a)(ii) until the times of receipt, and stated:

This position applies equally where payment of the lump sum is deferred to a subsequent year, provided that the individual chooses the deferred option on or before termination of employment.

Summary of 7 April 2020 External T.I. 2019-0832241E5 under s. 56(1)(a)(ii).