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 an amount be transferred from an RPP to an RRSP.
Position: Only as a normal RRSP contribution.
Reasons:
An amount can only be transferred under a special transfer provision of the Act if it is a single amount as defined in the Act.
XXXXXXXXXX 2003-015086
Wayne C. Harding
May 9, 2003
Dear XXXXXXXXXX:
Re: Transfer of Pension Funds
Advance Income Tax Ruling Request
This is in reply to your letter of of April 7, 2003, wherein you requested an advance income tax ruling in respect of your proposed transfer of an amount from a pension plan to an RRSP.
As discussed during our telephone conversation of May 5, 2003 (XXXXXXXXXX/Harding), your proposal to transfer an amount from a registered pension plan to an RRSP is not one on which we can provide a favourable ruling. However, we are prepared to provide the following general comments.
There are a number of specific provisions in the Income Tax Act (the "Act") that may permit the transfer of amounts from a registered pension plan to an RRSP, where the amount transferred is a "single amount". A "single amount" is a term that is defined in the Act that means an amount that is not part of a series of periodic payments. The lump sum payment you propose to transfer to an RRSP is a cumulative payment of the pension payments that would have been made during the period of the postponement of your pension had your pension not been postponed. Accordingly, it is our view, the payment is not a single amount as defined in the Act and it cannot be transferred to an RRSP using one of the specific provisions of the Act. However, the amount may still be contributed to an RRSP as part of your normal RRSP contributions to the extent you have any unused RRSP contribution room in the year the payment is made. This form of contribution may be made to either your own RRSP or to an RRSP under which your spouse is the annuitant. Tax withholding would not be required on the amount transferred.
We trust these comments will be of assistance to you.
Yours truly,
Roberta Albert, CA
for Director
Financial Industries Division
Income Tax Rulings Directorate
Policy and Legislation Branch
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