Does a TFSA specimen plan (respecting a deposit with a bank) that give the issuer the right to apply a positive balance from the account to satisfy any debts owing by the holder to the issuer or any of its affiliates comply with the conditions in ss. 146.2(2)(a) and (b). After noting that this “arrangement benefits the issuer and its affiliates,” and before concluding that “the plan would not qualify as a TFSA,” CRA stated:
Therefore, the arrangement cannot be said to be exclusively benefiting the holder and falls offside of the condition in paragraph 146.2(2)(a). Further, by allowing a positive balance to be applied to a debt owing to the issuer’s affiliates, the arrangement gives rights relating to amounts and timing of distributions to someone other than the holder or issuer and thus offends the condition in paragraph 146.2(2)(b).