20 September 1995 External T.I. 9518905 - TRANSFER FROM FOREIGN PENSION PLAN TO RPP

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 Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues:

Whether tax deferred roll between foreign pension plan and RPP is possible.

Position TAKEN:

Yes, given certain conditions.

Reasons FOR POSITION TAKEN:

Routine

XXXXXXXXXX 951890

Attention: XXXXXXXXXX

September 20, 1995

Re: Transfer of Funds for Past Services from a Defined Benefit Foreign Pension Plan to a Registered Pension Plan

This is in reply to your letter of July 17, 1995, in which you ask us to confirm a previous technical interpretation concerning the transfer of pension benefits from a foreign (unregistered) pension plan to a registered pension plan ("RPP").

This will confirm that where funds in a foreign pension plan corresponding to a member's entitlement under the plan are transferred directly to an RPP in one lump sum amount and

(a)the terms of the RPP provide for such a transfer, and

(b) the transfer is not at the member's request, i.e. it is not in the member's power to demand payment of the funds or roll the funds into another plan,

there will be no income inclusion required or deduction available under the Income Tax Act as a consequence of the transfer for such a member who is resident in Canada at the time of the transfer. As you note, the Minister must approve such a transfer as provided in subparagraph 8502(b)(v) of the Income Tax Regulations.

Although the foregoing comments are not binding on the Department we trust they will be of assistance to you.

Yours truly,

for Director
Financial Industries Division
Income Tax Rulings and
Interpretations Directorate