In 29 November 2016 CTF Roundtable Q. 5, 2016-0670801C6, CRA indicated that it now considered the payment of fees for investment management of an RRSP, RRIF or TFSA by the plan annuitant or holder typically will be considered to be an “advantage” giving rise to tax under s. 207.05(1) equal to 100% of the fee amount (noting inter alia under the hypothetical arm’s length test in s. 207.01(1) – advantage - (b)(i) that it would not be “commercially reasonable for an arm’s length party to gratuitously pay the expenses of another party”) but that to give the investment industry time to make the required system changes, it would defer applying this new position until January 1, 2018. 2017-0722391E5 announced a one-year extension to January 1, 2019.
CRA now stated:
[W]e will be deferring implementation of the position pending completion of a review of the issue by the Department of Finance Canada.