What's new for RRSPs and related plans
Advanced life deferred annuity (ALDA)
For 2020 and later taxation years, you can transfer certain amounts form an RRSP, a RRIF, a PRPP, a money purchase RPP or a DPSP to purchase an ALDA, using Form T2157, Direct Transfer from a Registered Plan to Purchase an ALDA. An ALDA is a life annuity where the annuity payments must be started before the end of the year in which you turn 85 years of age. An ALDA is payable for as long as you live, or if it is a joint-lives annuity, for as long as you or your spouse or common-law partner lives.
Fixing contribution errors in money purchase registered pension plans (MP RPP)
Under proposed legislation, plan administrators of MP RPPs are able to correct for both under-contributions and over-contributions. The proposals would permit:
- certain types of errors to be corrected through additional contributions to an employee’s account under a MP RPP to compensate for an under contribution error made in any of the preceding 10 years, subject to a dollar limit
- plan administrators to correct for pension over-contribution errors in respect of an employee for any of the 10 years prior to the year in which the excess amount is refunded to the employee or employer, as the case may be, who made the contribution
This measure would apply in respect of additional contributions made, and amounts of over-contributions refunded, in the 2021 and subsequent taxation years.
As the legislation for budget proposal may not be finalized at the time the guides and forms were printed, the CRA will publish electronically, if necessary, the revised guides and forms once the applicable legislation has been finalized. Please check the CRA website Forms and publications page. If you file your return prior to the revised forms becoming available, you may need to change your return.
Forms and publications
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