VANCOUVER DISTRICT OFFICE LIAISON COMMITTEE MEETING
Qualified Investments
The definition of qualified investments contained in Regulation 4900(1)(g) in respect to credit unions makes reference to an exception in respect of "benefit" or privileges to annuitants" which has the effect of making such investments disqualified. What type of benefits or privileges are the object of this provision? (for example some credit union pay bonus interest on large deposits).
Department's Position
The Regulation covers such inducements granted by plan issuers to investors as bonus interest, gifts, discounts on goods, chances at a prize, or other rights, things or properties of value. Similar restrictions on plan issuers are contained in paragraph 146(2)(c.4) which prevents the registration of a plan which extends an advantage to an annuitant of an RRSP or to a related person. Benefits or privileges which remain in the plan, however, such as bonus interest on the RRSP or cash deposited into the RRSP are not considered to be granted to the annuitant within the meaning of the Regulation, and would therefore not cause the investment to become non-qualified.
Prepared by: P. Spice (613) 957-3496