The Directorate indicated that a tax debtor could provide a hypothec of his interest in his RRSP to CRA in order to secure a tax debt without the RRSP being considered to have breached the condition in s. 146(2)(c.3)(ii), so that there would be no inclusion of the FMV of the RRSP in the annuitant’s income under s. 146(12). The Directorate stated:
[T]he conditions for the application of subsection 146(12) are not satisfied by the mere fact that a creditor acquires a legal hypothec by virtue of article 2730 of the Civil Code of Québec.