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 CCRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ADRC.
Principal Issues:
Can locked-in and non-locked-in RPP funds be transferred to the same RRSP?
Position: Provide general information.
Reasons:
There is nothing in the Act that prevents the transfer of locked-in and non locked-in pension funds to the same RRSP. The PBSA and the applicable provincial pension authorities regulate locking-in requirements for pension funds.
XXXXXXXXXX 2002-017109
G. Allen
December 13, 2002
Dear XXXXXXXXXX:
Re: Transfer of Pension Funds to a Registered Retirement Savings Plan
This letter is in reply to your letter dated October 11, 2002 concerning the transfer of property from a registered pension plan ("RPP") to a registered retirement savings plan ("RRSP").
Written confirmation of the tax implications inherent in particular transactions are given by this Directorate only where the transactions are proposed and are the subject matter of an advance income tax ruling request. For more information concerning advance tax rulings, please refer to Information Circular 70-6R5 dated May 17, 2002. Copies of information circulars are available at your local Tax Services Office or on the Internet at http://www.ccra-adrc.gc.ca/formspubs/menu-e.html. Where the particular transactions are completed, the enquiry should be addressed to the relevant Tax Services Office. However, we are prepared to provide the following general comments, which may be of assistance.
Subsections 147.3(1) and 147.3(4) of the Income Tax Act (the "Act") permit the direct transfer, provided certain conditions are satisfied, of an amount from an RPP to an RRSP under which the member of the RPP is the annuitant. There is no provision under the Act that requires an amount transferred from an RPP to be transferred to a locked-in RRSP. Further, the Act does not prevent locked-in and non-locked-in pension funds from being transferred to the same RRSP.
The federal Pension Benefits Standards Act, 1985 ("PBSA"), which governs federally regulated industries, or the equivalent provincial pension laws govern the locking-in requirements for pension plans. The PBSA or the equivalent provincial law permit the transfer of locked-in registered pensions to an RRSP provided the RRSP satisfies the applicable federal or provincial RRSP conditions for locked-in pension funds.
We trust our comments will be of assistance.
Roberta Albert, CA
for Director
Financial Industries Division
Income Tax Rulings Directorate
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