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.
Dear Sir:
Re: Amount of Retiring Allowance transferable to a Registered Retirement Savings Plan ("RRSP")
This is in reply to your letter of February 13, 1991 concerning the transfer of a severance pay retiring allowance to an RRSP under paragraph 60(j.1) of the Income Tax Act (the "Act").
As indicated in Information Circular 70-6R2, we do not express opinions on specific proposed transactions other than as a reply to an advance income tax ruling. As a consequence thereof, we may only offer the following general comments.
As you are aware, the main criteria to be considered in determining whether an employee is entitled to transfer to an RRSP the amount of $3,500 or $2,000 for any particular year of service is whether the employer's contributions to the RPP is vested.
As this is a question of fact that can only be answered by reference to the particular pension plan, we are unable to determine whether or not your employer's contributions to the pension plan on your behalf have vested. It should be noted, however, that the fact that the commuted value of a pension at any particular time may be less than the total of the employee's contributions plus interest does not necessarily mean that the employer's contributions have not vested under the terms of the plan.
To obtain a definite answer to your query, we suggest you submit your pension plan to your District Office for their consideration.
We trust the above comments will be of assistance to you.
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© Her Majesty the Queen in Right of Canada, 1991
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© Sa Majesté la Reine du Chef du Canada, 1991
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