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 a withholding of the minimum amount under a RRIF is required where all of the property in the plan is transferred but remains with the same carrier?
Position: No.
Reasons: Wording of the Act
XXXXXXXXXX 5-980500
Fouad Daaboul
Attention: XXXXXXXXXX
June 23, 1998
Dear Sirs:
Re: Request for technical interpretation
We are writing in response to your letter of February 27, 1998, wherein you requested the Department’s position on the necessity to withhold the annual minimum payment (the “AMP”) whenever a registered retirement income fund (the “RRIF”) sponsored within a group of related corporations is transferred into a different RRIF within the same group of related corporations.
You are requesting that transfers (of all property in a RRIF) between RRIF plans within the same group of corporations not be subject to the AMP requirement at the time of transfer as most clients expect a fixed payment schedule with regard to payments from the RRIF. You propose that under such transfers the AMP requirement established at the start of the year with respect to the transferor plan would be continued in the transferee plan for that year as well as for subsequent years.
Paragraph 146.3(2)(e) of the Income Tax Act (the ”Act”) requires the use of the Prescribed Form T2033 where the annuitant requests a direct transfer of funds, from a transferor carrier to any person, from a RRIF to another RRIF of the same annuitant. In these circumstances and under paragraph 146.3(2)(e.1) of the Act, the transferor carrier must withhold the AMP for the year. However, as stated in paragraph 47 of Information Circular 78-18R5, Form T2033 is not required where the annuitant requests a direct transfer of funds from a RRIF to another RRIF of the same carrier.
Where Form T2033 is not required pursuant to paragraph 47 of Information Circular 78-15R5 we would agree with the AMP payment methodology you have outlined with regard to such transactions.
We trust our comments will be of assistance to you.
Yours truly,
Paul Lynch
for Director
Financial Industries Division
Income Tax Rulings and
Interpretations Directorate
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 1998
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 1998
Email this Content