R. Nanner (613)957-3494
October 17, 1988
Dear Sirs:
This is in response to your letter of September 30, 1988 concerning the application of the coming-into-force provisions of the retirement compensation arrangement ("RCA") legislation with respect to income earned by an employee benefit plan (EBP) to which the above legislation applies and other related issues.
The RCA legislation does not apply to contributions made prior to January 1, 1988 to an EBP that was in existence before October 9, 1986 provided the terms of the EBP have not been materially altered. Furthermore, income earned after December 31, 1987 on such contributions is also not subject to the RCA legislation.
With respect to your second question, we are in agreement with your position.
With regards to your question on contributions made after October 8, 1986 and before January 1, 1988, we are of the view that unless the terms of an EBP which was in existence prior to October 8, 1986 have been materially altered, the contributions would be considered to have been made to the EBP and not to an RCA.
We hope these comments are of assistance to you.
Yours truly,
Wayne Douglas
for Director Financial Industries Division Rulings Directorate