Registered Retirement Savings Plans

IC 72-22R9

June 17, 1996

This circular cancels and replaces Information Circular 72-22R8 dated March 18, 1991.

1. This circular interprets certain provisions of the Income Tax Act (the Act) that apply to registered retirement savings plans (RRSPs) and outlines the Department's rules for companies that issue RRSPs. Additional information is available in the publications listed in paragraph 44 below.

2. This circular has five parts:

Part I - Approval (paragraphs 3-20)
Part II - Registration (paragraphs 21-27)
Part III - Annuities (paragraphs 28-32)
Part IV - Receipts (paragraphs 33-40)
Part V - General (paragraphs 41-45)



3. The following can issue RRSPs:

(a) companies that are licensed to carry on an annuities business in Canada (e.g., insurance companies);

(b) Canadian trust companies;

(c) corporations that have been approved by the Governor in Council to sell investment contracts for RRSPs; and

(d) a depositary defined in section 146 of the Act as:

(i) a member or a person eligible to become a member of the Canadian Payments Association; or

(ii) a credit union that is a shareholder or member of a central corporate body for purposes of the Canadian Payments Association Act.

This circular provides comments directly to you, the issuer of a retirement saving plan (RSP), concerning the administration of the plan.

4. The term "annuitant" as used in this circular is defined in subsection 146(1) of the Act. The annuitant is the individual for whom the RSP provides the retirement income. If the annuitant dies after the plan has matured, the annuitant's spouse may become the annuitant.

We have to approve an RSP specimen plan before any contracts can be registered and sold under that plan. Contributions can only be deducted in respect of registered plans. Therefore, an RSP should not be sold until we have given approval.

5. The following documents make up a specimen plan.

(a) For an RSP issued by a company described in 3(a) above the following documents are required:

(i) a copy of the complete contract (policy, application form, schedules, and any riders or locking-in addenda);

(ii) a copy of the endorsement needed to qualify the contract for registration as an RRSP, unless the contract itself is a self-contained RSP; and

(iii) a copy of the annuitant's application form requesting that the contract be registered as an RRSP, if not contained in the policy application or RSP endorsement.

(b) For an RSP issued by other than an insurance company the following documents are required:

(i) a copy of the declaration of trust or text of the arrangement, and any applicable locking-in addenda;

(ii) a copy of the application form; and

(iii) if requested, confirmation from the Canadian Payments Association of the depositary's status as referred to above in 3(d)(i).


6. The RSP must not provide for any of the following:

(a) The RSP cannot provide for the payment of any benefit before maturity except:

(i) a refund of premiums in a lump sum; and

(ii) a payment to the annuitant.

(b) The RSP cannot provide for the payment of any benefit after maturity except:

(i) retirement income to the annuitant;

(ii) full or partial commutation of retirement income under the plan to the annuitant; and

(iii) commutation referred to in 7(c) below.

(c) The RSP cannot provide for a payment to the annuitant of a retirement income except by:

(i) equal annual or more frequent periodic payments until there is a payment in full or partial commutation of the retirement income; and

(ii) when the commutation is partial, equal annual or more frequent periodic payments afterwards.

(d) The RSP cannot provide for periodic payments in a year under an annuity after the death of the first annuitant that total more than the payments under the annuity in a year before the death.

(e) The RSP cannot provide for the payment of any premium after maturity.

7. The RSP must provide for the following:

(a) maturity no later than the end of the year in which the annuitant reaches 69 years of age (see Note);

(b) payment of an amount to a taxpayer to reduce the amount of tax the taxpayer would otherwise have to pay because of over- contributions by the taxpayer; and

(c) the commutation of each annuity payable that would otherwise become payable to a person other than an annuitant under the plan.


The March 1996 federal budget announced the proposed change in the maturation limit from age 71 to 69. No retirement savings plan will be registered after 1996 unless it complies with the revised requirements. For more details, or for information regarding the budget's impact on existing plans, you can contact the Registered Plans Division at the address in 11 below. You can also call (613) 954-0419 (English) or (613) 954-0930 (French).

8. The RSP must include provisions that do the following:

(a) The annuitant or a person with whom the annuitant was not dealing at arm's length cannot receive an advantage that is conditional on the existence of the plan, other than:

(i) a benefit;

(ii) amounts included in a deceased annuitant's income or included in the income of an RRSP trust for years that the trust has lost its exempt status due to the death of the last annuitant;

(iii) the payment or allocation of any amount to the plan by the issuer;

(iv) an advantage from life insurance in effect on December 31, 1981; or

(v) an advantage obtained from administrative or investment services provided for the plan.

(b) The RSP must prohibit all or any part of the retirement income from being assigned.

(c) For a depositary, the RSP must clearly state that:

(i) the depositary cannot use the property held under the plan to offset any debt or obligation owing to the depositary; and

(ii) the property held under the plan cannot be pledged, assigned, or in any way alienated as security for a loan or for any purpose other than to provide the annuitant with a retirement income starting at maturity.

Where an advantage, for example a gift, that is prohibited under paragraph 8(a) above, is extended to an RRSP annuitant, you may be assessed a penalty under subsection 146(13.1) of the Act. For more information on the application of subsection 146(13.1) please refer to IT-415 Deregistration of Registered Retirement Savings Plans.


The terms of the RSP can be more restrictive than those required by the Act (e.g., additional restrictions on the maturity date, withdrawals before maturity, or commutation), as long as the restrictions are clearly stated in the plan text.


9. A specimen plan consists of an application form and the specimen text. The application form has to request the following information:

(a) the annuitant's name, address, social insurance number, and date of birth;

(b) the contributor's name and social insurance number, if other than the annuitant;

(c) the annuitant's signature (the contributor who is not the annuitant does not sign the application form);

(d) the contract number (account, certificate or identifying number);

(e) the issuer's name;

(f) the signature of an authorized officer of the issuer accepting the application.

The application form has to include a clause in which the annuitant requests the issuer to apply for registration of the plan as an RRSP under section 146 of the Act. If the specimen plan is for a particular employer, association, or other organization, the application form has to include a clause in which the annuitant authorizes the applicable organization to act as the annuitant's agent.

10. Do not use the word "registered" or the full acronym RRSP when referring to the name of the plan in the application form or specimen documents. This is because only the individual arrangements issued in the approved form are registered, and not the specimen itself. (See Part II, Registration.)

11. Submit your draft of the proposed RSP to:

Registered Plans Division
Revenue Canada
700 Industrial Avenue
Ottawa ON K1A 0L8


12. An association, employer, or other organization can sponsor a group RSP. A group RSP is essentially a collection of individual RRSPs for the employees or members of the applicable organization. Individuals belonging to the organization or their spouses are eligible to participate. The organization can act as agent for the annuitant for certain purposes, such as receiving contributions to the RSP. If applicable, the text of the RSP contract and its application form should clearly show that the annuitant has authorized the organization to act as his or her agent and for what purpose.

13. When the organization acts as agent for the annuitant the plan has to state that the ultimate responsibility for the administration of each plan remains with you, as issuer. You have to deal directly with the Department concerning all RSP matters and reporting requirements unless we have your written authorization to deal with another person. The organization may not make changes to the approved specimen plan.


14. You may have an agreement with an agent, such as an investment broker, that allows the agent to provide you with certain administrative and investment functions. It is not necessary to submit the agency agreement with the specimen plan. If you appoint the agent as custodian of the securities, and the securities are registered in the agent's name, then the agency agreement, the identity of the trustee, and the contract or identification number of the RRSP that governs the trust should be clearly disclosed in the security registration form.

15. The specimen plan must contain a clause stating that the ultimate responsibility for the administration of each plan remains with you, as issuer. The agent cannot make changes to the approved specimen plan.


16. As issuer, you may set up an RSP specifically for locked-in registered pension plan funds. If a locking-in addendum or supplementary agreement is used together with an existing specimen plan, separate accounts have to be kept for the locked-in and non- locked-in portions.


17. We will notify you when the RSP can be accepted for registration as an RRSP, and will request a final printed copy of the documents that constitute the specimen plan.


18. We should approve all amendments or revisions to the specimen plan before the amendments are put into effect. Your submission to us should identify the nature of each change.

If you amend the specimen plan to accommodate the transfer of locked-in registered pension plan funds, you have to include a copy of the locking-in addendum or supplementary agreement.


19. The terms of your specimen plan may allow you to resign as the issuer and appoint a successor issuer. This is generally considered to be an amendment to the specimen plan. To process the change, we need a letter telling us that the issuer has changed, and giving the effective date of the change. We also need confirmation from you or from the successor issuer that each annuitant who has a contract conforming to the specimen plan has been informed of the change. The successor issuer should send any amendments to the specimen plan resulting from the change to us for approval at the address in 11 above.


20. You should advise us when you are no longer selling individual plans under the specimen plan. Also notify us when there are no longer any outstanding individual plans that conform to the specimen plan so that we can close our files.


21. The address to register RSPs is:

Registered Plans Division
Revenue Canada
700 Industrial Avenue
Ottawa ON K1A 0L8

22. To register RSPs for new annuitants, you have to:

(a) provide us with a list of the plans and include:

(i) the name, address, and social insurance number of each annuitant; and

(ii) contract numbers you have assigned for each arrangement (contract, account, certificate, or identifying number); and

(b) identify:

(i) the name of the specimen plan and the number assigned by us to the specimen plan; and

(ii) the calendar year or the period, such as the first 60 days of the calendar year, in which the plans listed were set up.

23. You can submit lists on a quarterly or other basis, but not later than 60 days after the end of the calendar year for which you want the plans to be registered. Include with each list a separate Form T550, Application for Registration of Retirement Savings Plans or covering letter for each specimen plan with the signature of an authorized officer of the issuer who:

(a) affirms that:

(i) the annuitants of the plans listed have requested registration of their plans;

(ii) the contracts or arrangements listed comply with the provisions of section 146 of the Act; and

(iii) the plans conform in all respects with the specimen plan approved by us and identified on the list; and

(b) states:

(i) the number of contracts or arrangements listed for each specimen plan, including the assigned number; and

(ii) the number of pages of the list.

Please do not submit lists as an attachment to Form T3R-G, Registered Retirement Savings Plan Group Information Return.

24. Each plan can be registered only once. Use a separate notice for corrections such as names or social insurance numbers.

25. You cannot list a plan for registration until you receive a contribution, as the plan doesn't exist until the payment is received.


26. For all jurisdictions in Canada that have pension legislation, the term locking-in generally means that benefits cannot be cashed out either before or after maturity. Transfer to a registered retirement income fund may generally be made if it is a locked-in fund. When a locked-in RRSP matures, the total value of the plan must be used to purchase a life annuity contract.

27. The federal Pension Benefits Standards Act, 1985 (PBSA) or the equivalent provincial law allows the transfer of locked-in registered pensions to an RRSP provided the RRSP meets the federal or provincial RRSP conditions for locked-in pension funds. The PBSA governs the Northwest Territories and Yukon, as well as federally regulated industries.



28. Generally, the Act defines retirement income in subsection 146(1) to include a life annuity with or without a guaranteed term, or a fixed-term annuity that provides benefits up to and including the age of 90. The guaranteed term for a life annuity cannot be more than 90 minus:

(a) the annuitant's age in whole years at the maturity of the plan; or

(b) if the annuitant's spouse is younger than the annuitant and the annuitant so elects, the spouse's age in whole years at the maturity of the plan.


29. When you, as the issuer, arrange for the purchase of an annuity with the RRSP funds, you should complete Form T2037, Notice of Purchase of Annuity with 'Plan' Funds, and give a copy to the issuer of the annuity. When you directly provide the annuity, however, Form T2037 is not necessary.

30. To find out what forms an annuitant should use when directly transferring to or from an RRSP or when purchasing an annuity, please refer to Information Circular 79-8, Forms To Use To Directly Transfer Funds To Or Between Plans, Or To Purchase An Annuity, as well as the latest version of the RRSP and Other Registered Plans For Retirement guide.

31. The commuted RRSP annuity can be used to purchase another life annuity for the annuitant. The annuity can be for the life of the annuitant (or the lives jointly of the annuitant and the annuitant's spouse), with or without a guaranteed term, or it can be a fixed-term annuity providing benefits up to and including the age of 90. The guaranteed term in years for a life annuity cannot be more than 90 minus:

(a) the annuitant's age at the time of the acquisition; or

(b) the age of the annuitant's spouse at the time of acquisition.

32. A trust governed by an RRSP or another authorized entity can acquire an annuity contract (as described by the definition "retirement income" in subsection 146(1) of the Act) prior to the date of maturity of the RRSP and defer the commencement of the payments until the plan's maturity date. We consider the deferred life annuity contract to be an investment of the RRSP funds and not a method of providing an immediate retirement income. The annuity contract has to be owned by the trust or other entity.


33. Each year you should issue a receipt to the annuitant for contributions made by the annuitant, or for property received as a result of a transfer of a commuted RRSP annuity. If the annuitant's spouse contributed to the plan, you should instead give the receipt to the spouse. The receipt cannot be more than 8 1/2 inches wide and should state that it is a receipt for an RRSP. In addition to giving instructions to submit the receipt with the contributor's income tax return, the receipt has to include the following:

(a) the name of the issuer of the RRSP;

(b) the signature of an authorized official (we will accept a facsimile signature as long as the receipts are numbered serially and a copy is kept at the issuer's head office);

(c) the contract or arrangement number;

(d) the name, address, and social insurance number of the annuitant;

(e) the name and social insurance number of the contributor if other than the annuitant;

(f) the total amount of premiums paid;

(g) the dates of payment of premiums (the receipt may show the amount received in the initial 60 days of the year and the amount received during the remainder of the year); and

(h) whether the contributions (premiums) were in whole or in part in kind, using the following text:
Contributions were in whole or in part in kind. () (check)

You should advise the annuitant to submit an explanation of any contribution in kind with his or her income tax return.

34. You may issue a receipt for each premium payment or for more than one payment. You may issue receipts for more than one payment twice a year. The first receipt is for payments made in the initial 60 days of the calendar year, and the second receipt is for payments made in the balance of the calendar year.

35. If you only issue one receipt for a fiscal period ending 60 days after the end of a calendar year, the receipt should identify the total payments you received prior to January 1, and the total payments received in the 60-day period on or after January 1. If only a part of a premium payment is for an RRSP, the receipt should indicate the amount that qualifies as an RRSP contribution for income tax purposes. A duplicate receipt should be clearly identified as a copy for the annuitant's records.


36. An instant receipt is one which is provided to the contributor at the time the contribution is made. All enquiries and matters concerning instant receipts should be directed to:

T1 Programs Division
Revenue Canada
Ottawa ON K1A 0L8

You can issue instant receipts for premiums as long as the receipts are not issued for any rollover or direct transfer of property. The instant receipts should contain the same information requested in 33 above, and should be typewritten, produced on a cheque printer, or computer-generated. We recommend sending a draft of the receipt specimen to the T1 Programs Division.

37. You can issue instant receipts without a contract number, but you should give the annuitant the contract number at a later date. Issue duplicate and amended receipts with a contract number as well as a reference to the original receipt number.

38. Please clearly indicate on the receipt if the contributor's spouse is the annuitant.

39. You should retrieve an instant receipt if it was issued in error, or if the receipt became invalid due to a stop payment or a non- sufficient funds (NSF) cheque. If all copies of an invalid receipt are not returned, we ask that you inform us as follows including the annuitant's name, social insurance number, and the receipt number:

(a) for contributors served by the Ottawa, Toronto, Mississauga, Scarborough, or North York tax services offices, inform the Assistant Director of Client Assistance at the appropriate office;

(b) For all others, inform the Assistant Director of Enquiries and Adjustments at the taxation centre that serves the annuitant.

40. If you cannot account for any unissued instant receipts, you have to provide the T1 Programs Division with any missing receipt numbers.


41. A taxpayer who contributes to an RRSP any time during the year or no later than 60 days after the end of the year is eligible to deduct RRSP contributions from income, as long as the taxpayer or the taxpayer's spouse is the annuitant. The taxpayer can deduct all or part of the contributions (other than certain rollovers and other exempted amounts) made no later than 60 days after the end of the year from his or her income for that year. These deductions are subject to the limitations in the Act.

42. A trust governed at any time in the year by an RRSP has to file an income tax return.

43. For detailed information on reporting and deduction requirements, taxation of a trust, and foreign property issues, please refer to the following publications: T4RSP and T4RIF Guide, IT-320, Registered Retirement Savings Plans - Qualified Investments, and IT 412, Foreign Property of Registered Plans.

44. The following publications have RRSP information. They are available at any Revenue Canada tax services office:

RRSP and other Registered Plans for Retirement Guide T4RSP and T4RIF Guide

IT-124 Contributions to Registered Retirement Savings Plans
IT-307 Spousal Registered Retirement Savings Plans
IT-320 Registered Retirement Savings Plans - Qualified Investments
IT-408 Life Insurance Policies as Investments of Registered Retirement Savings Plans and Deferred Profit Sharing Plans
IT-412 Foreign Property of Registered Plans
IT-415 Deregistration of Registered Retirement Savings Plans
IT-500 Registered Retirement Savings Plans (maturing after June 29, 1978) - Death of Annuitant after June 29, 1978
IC 74-1 Form T2037, Notice of Purchase of Annuity with "Plan" Funds
IC 76-12 Applicable Rate of Part XIII Tax on Amounts Paid or Credited to Persons in Treaty Countries
IC 77-16 Non-Resident Income Tax
IC 78-14 Guidelines for Trust Companies and Other Persons Responsible for filing T3R-IND, T3R-G, T3RIF-IND, T3RIF-G, T3H-IND, T3H-G, T3D, T3P, T3S, T3RI and T3F Returns
IC 79-8 Forms to be Used for Direct Transfer of Funds to or Between Plans or for the Purchase of an Annuity


45. Information that we obtain for taxation purposes is strictly confidential. Only the taxpayer or a person the taxpayer or the law authorizes has access to this information. The Privacy Act and the Access to Information Act reinforce this protection.

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