CRA confirms no withholding where an RCA pays a retiring allowance to the beneficiary’s RRSP that is an s. 60(j.1) eligible amount or within the RRSP deduction limit

The beneficiary of a retirement compensation arrangement (RCA) set up by his employer was entitled on his retirement in 2017 to receive a $50,000 retiring allowance, which was transferred directly to his RRSP. CRA confirmed that, by virtue of Reg. 100(3)(c), no withholding by the RCA custodian was required given that his RRSP deduction limit for his 2017 taxation year, as confirmed by his notice of assessment for his 2016 taxation year, was $30,000, and the eligible portion of the retiring allowance qualifying for the s. 60(j.1) deduction was $20,000.

Neal Armstrong. Summary of 9 June 2017 External T.I. 2017-0700961E5 F under Reg. 100(3)(c).