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COMPLIANCE MANUAL ONTARIO REGISTERED PENSION PLANS

iA Financial Group is a business name and trademark of Industrial Alliance Insurance and Financial Services Inc.

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ia.ca

1. Member Profile Form

2. IPP Proposal

3. Request for T4 slips

4. Completing the Onboarding Documents

5. Plan Registration

6. Your Binder

7. iA Financial Group Client Space Activation Letter

8. CRA Deemed-Registration Letter

9. FSCO Deemed-Registration Letter

10. CRA Final Registration Letter

11. Employer Contributions

12. Member Qualifying Transfer

13. FSCO Formal Registration Letter

14. FSCO Pension Services Portal (PSP) Activation Letter

15. Delegating iA on FSCO’s PSP

16. CRA Re-Assessment (Notice of Assessment)

17. Ongoing Compliance


iA Financial Group is a business name and trademark of Industrial Alliance Insurance and Financial Services Inc. ia.ca

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1. Member Profile Form The client has heard about the Individual Pension Plan (IPP) from the advisor or visited our IPP website and now wonders if this plan is a tax-effective solution for him or her. We suggest to prepare an IPP Proposal personalized to his or her own situation. The advisor should complete the Member Profile Form. Specifically, we need the client date of birth, the full name of his company, T4 earnings since the date of employment, RRSP assets and unused RRSP room. Figures don’t need to be exact at that point, but the more they are the more accurate the IPP Proposal will be. It is recommended to prospective clients not to make any RRSP contributions in the year in which they might be setting up a IPP. 2. IPP Proposal The IPP Proposal describes the advantages of the IPP over a personal RRSP and shows a personalized projection under both options according to the financial information provided. It also projects the pension offered by the IPP at different retirement ages and shows the various options available at retirement. It is possible to contact iA’s Business Development Manager to organize a conference call or webinar to walk the client, the advisor and the accountant through the results.



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3. Request for T4 slips One of the numerous advantages of the IPP is that it allows the client to recognize years of past services earned while working for the company when no pension plan existed. It allows one to tax-shelter much more money and increases the benefits payable at retirement. To ensure our calculations will be accurate and avoid any potential issues with the regulators, we require copies of T4 slips for all years of past services that are to be recognized by the plan. We know how difficult it can be to retrieve T4 slips from previous years and offer to request them to the Canada Revenue Agency (CRA) on the client behalf using a CRA Form T1013 (can be obtained from your distributor portal). This request can sometimes take as much as 4 months. For this reason, although you may not be ready to establish the IPP just yet, we recommend that we start the process of gathering the T4 slips for past years right away to avoid undue delays when the client will be ready to go ahead with the IPP.

4. Completing the Onboarding Documents With the information provided in the Information Form, iA’s Business Development Manager will send a package of documents the advisor and the client need to complete prior to establishing the IPP. These documents include the Plan Provisions, some forms gathering your personal information and some forms required by the regulators. A Checklist of all the Onboarding Documents will also be provided. Once completed and signed, all original documents must be mailed to:

iA Financial Group IPP Team- Group Savings and Retirement (CSC6224) 1080, Grande Allée West Quebec City QC G1K 7M3

It is highly recommended that scanned versions of the documents be emailed to [email protected] prior to sending the signed documents by courier so that corrective actions may take place right away.

mailto:rri-ipp@ia



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5. Plan Registration iA Financial Group will verify your information and prepare the actuarial valuation report and all other necessary documents for registration. The plan will be registered with the CRA and the Financial Services Commission of Ontario (FSCO). Once we have received all the documents and information, we target to send the documents to the regulators within 2 weeks. Certain forms will be automatically prepared by iA Financial Group including the CRA Forms T1007 and T1004. The T1007 is automatically filed if the plan member is a connected person. The T1004 would be filed when past service is purchased to calculate the Past Service Pension Adjustment. They do not require client signatures. 6. Your Administration Binder At the same time we register the plan with the regulators, we will prepare an Administration Binder containing all the documents related to the administration of the pension plan. We will mail this Binder to the advisor to review it with the client. The Administration Binder contains: The Contract with iA Financial Group The Plan Text of the IPP The Administrator’s Guide The initial Actuarial Valuation Report The Contribution Statement The Statement of Investment Policies and Procedures (SIP&P) The Procedure to Delegate iA on FSCO’s Pension Services Portal An Invoice by iA Financial Group



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7. iA Client Space Activation Letter The client will receive a letter from iA Financial Group giving him his Client Space activation key which will enable contributions made to the IPP to be allocated within the various segregated fund options available on the IPP platform (and GICs). 8. CRA Deemed-Registration Letter Typically within 20 days of receipt of the Onboarding Documents, the client will receive a letter from the CRA notifying him or her that they have received the documents from iA Financial Group and will be reviewing the file. This letter also provides the registration number that has been assigned to the IPP. Please note that the plan has not received final approval of the registration at this point. The client could do current service contributions at this point, but he can’t contribute towards the past service deficit or make the Qualifying Transfer. There is no need to send iA Financial Group a copy of this deemed registration letter since the CRA will have notified us at the same time.



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9. FSCO Deemed-Registration Letter FSCO will also send the client a letter informing him that the submission for registration will be processed shortly. FSCO assigns the same registration number that CRA assigned. As with CRA’s letter, this letter is not the final approval of the registration with FSCO. There is no need to send iA Financial Group a copy of this deemed registration letter since FSCO will have notified us at the same time. 10. CRA Final Registration Letter CRA will then send the client another letter about three months after the deemed registration letter to advise that the registration of the IPP has been confirmed. They usually approve the initial actuarial valuation report at the same time as well, but that is not always necessarily the case. The IPP is now fully registered with CRA and if the actuarial valuation report is also approved, the client can now purchase past service by transferring RRSP assets as a Qualifying Transfer within 90 days from the date of the approval of the valuation, and making corporate contributions (if any) required to complete the past service purchase. iA Financial Group will contact the advisor upon receipt of this letter to plan for the Qualifying Transfer to take place (see Step 12 below). There is no need to send iA Financial Group a copy of this registration letter since the CRA will have notified us at the same time.



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11. Employer Contributions The company can now fund the past service deficit if any and the normal cost of the plan. We have included a Contribution Statement in the binder the client received and a CD with an Excel Spreadsheet. Given the complexity of calculating the contributions in some IPPs, we recommend that the client uses the Excel Spreadsheet to calculate the amounts that the company can contribute to the plan. The client may then send a cheque payable to iA Financial Group to the following address with a printout of the Excel Spreadsheet to clearly identify his plan. iA Financial Group Group Savings and Retirement (CSC6224) P.O. Box 1907, Station Terminus Quebec City, Quebec G1K 7M3 12. Member Qualifying Transfer If the client is buying back past service in the IPP, he is most likely required to do a Qualifying Transfer. The Qualifying Transfer is required by CRA to ensure a certain level of fairness in the Canadian retirement system between an individual with a IPP versus someone who doesn’t have one. It consists of transferring some assets held in a designated savings arrangement (RRSPs, LIRAs, RRIFs, LIFs, and DC plans) to finance a portion of the past services recognized in the IPP and the balance of the costs is funded by the company. The amount of Qualifying Transfer that must be transferred is indicated on the Contribution Statement included in the binder. The financial advisor should use CRA Form T2033 for RRSPs and T2151 for DC Plans. Please note that the Qualifying Transfer must be completed within 90 days following the date on CRA’s final registration letter. Once the transfer is completed, the advisor must provide iA Financial Group with copies of the statements showing that the transferred assets came from a designated savings arrangement to the IPP because it will be required by the CRA as part of the internal audit process.



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13. FSCO Formal Registration Letter FSCO will also send the client a registration letter after they have reviewed all the documents submitted. It is usually three to six months after submission of the registration documents. The FSCO Formal Registration Letter also includes a Certificate of Registration. There is no need to send iA Financial Group a copy of this registration letter since FSCO will have notified us at the same time. 14. FSCO Pension Services Portal (PSP) Activation

Letter Following their formal registration letter, FSCO will mail client another letter containing an activation key to create his account on the PSP. It is very important that the client activates this access upon receipt of the letter and then delegate iA Financial Group’s actuaries on the PSP to access his account. See instructions re: PSP below in Step 15.



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15. Delegating iA on FSCO’s PSP iA Financial Group provides the client with a full service IPP product that ensures all required filings can be effected seamlessly with minimal client input. Some of the filings have to be submitted through FSCO’s PSP and the only way to do so is for us to be delegated on the client IPP account. It is therefore important that the client activates his account and then follow the procedure that we have included in the Administration Binder to delegate iA Financial Group’s actuaries on the PSP. Once this delegation has taken place, iA Financial Group can then make all necessary filings with respect to the IPP on a go-forward basis, thus simplifying administration for clients. 16. CRA Re-Assessment (Notice of Assessment) When we establish a IPP for the client, CRA may reduce the member’s RRSP contribution room depending on whether he or she is a connected person to the company and if past service is being recognized under the IPP. At the time of submitting the registration documents to CRA, we will complete a CRA Form T1004 - Applying For The Certification Of A Provisional PSPA if the IPP is recognizing past service and a CRA Form T1007 - Connected Person Information Return if the client is a connected person. After processing these forms, CRA will send the client a re-assessment of the RRSP Deduction Limit. It is important to wait for this Notice of Assessment before to attempt contributing to an RRSP account following the establishment of the IPP. We recommend that the client sends us a copy of this Notice of Assessment to confirm all forms have been processed correctly.



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17. Ongoing Compliance With the IPP now being established and registered and with ongoing contributions being made to the plan and invested by the financial advisor, please refer to the Compliance Manual for Ongoing Administration for a calendar of compliance events that punctuate the year once the plan is in effect.