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.
XXXX
B. Toyota (613) 995-0051 May 6, 1985
Dear Sirs:
This is in reply to your letter of March 13 concerning the use of property held by an RRSP as security for a loan.
It is not clear from the scenario described in your letter whether the RRSP is a "depository" plan or a trust arrangement. Paragraph 146(2)(c.3) applies only to depository plans and, in such plans, the use of its property as security for a loan used for any purpose other than to provide a retirement income commencing at maturity is prohibited by that paragraph and could result in deregistration.
In the case of a trust arrangement, the provisions of subsection 146(10) would apply to tax the annuitant under the plan on the fair market value of the properties used as security.
We hope the above will be of assistance.
Yours truly,
for Director Non-Corporate Rulings Division
146(2)(c.3)
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