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:
If employee is re-hired by government and elected to purchase pre-1989 service for PSSA purposes, whether $3,500 or $2,000 can be transferred tax free to an RRSP pursuant to paragraph 60(j.1).
Position TAKEN:
Limited to $2,000 per year of service.
Reasons FOR POSITION TAKEN:
When past service is purchased, we consider the employer contributions to have been paid by the employee and thus vested.
Director Personnel Relations
Policy and Compensation
Department of National Defence 5-941291
12th Floor, Berger Building M. SheaDesRosiers
100 Metcalfe Street
Ottawa, Ontario
K1A 0K2
Attention: T.W. McCready
June 14, 1994
Dear Sir:
Re: Transfer of retiring allowance to a
Registered Retirement Savings Plan ("RRSP")
This is in reply to your letter of May 11, 1994 and to your telephone conversation (Lalonde/Aubé) of June 8, 1994 concerning the above-mentioned subject.
In the case of a former employee who was re-hired by the Government and elected to purchase pre-1989 service for PSSA purposes, the amount that can be transferred tax free to an RRSP, pursuant to paragraph 60(j.1) of the Income Tax Act, is limited to $2,000 per year of service prior to 1989.
We trust the above comments will be of assistance to you.
Yours truly,
for Director
Financial Industries Division
Rulings Directorate
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