Why INTEGRIS is not a PRPP (Pooled Registered Pension Plan)?
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The federal government has recently adopted legislation creating yet another new type of pension vehicle, the Pooled Registered Pension Plan.
INTEGRIS is NOT a PRPP. PRPPs are basically a locked-in RRSP invested by plan members. Under a PRPP the employer does not have any obligation to contribute.
The tax limits under the PRPP are the same as those applicable to RRSPs (in other words, inferior to those applicable to INTEGRIS.) Moreover, in the event of a decline in stock markets, there is no ability under a PRPP to make additional tax-deductible contributions to replenish the pension fund - INTEGRIS does. PRPPs are designed to assist small companies with modestly-paid employees who have not been saving for retirement through a tax-assisted plan. On the other hand, INTEGRIS is built for owner-operators and incorporated professionals who need a robust pension comparable to the pensions paid to teachers and civil servants.
In light of the new tax rules that penalize passive investments within CCPCs, advisors must understand how pension legislation can become a powerful tool to deal with wealth succession, business succession, and tax optimization within a corporate environment.
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