Save up to 65% more for retirement!
An Individual Pension Plans (IPP) is a defined benefit pension plan that can provide maximum tax-deductible contributions for your retirement. Similar to RRSPs, IPPs uses an investment account to provide for retirement. Unlike RRSPs, IPPs provides a certain guarantee of retirement benefits that are locked-in for retirement only. In addition, it allows for more accumulation of assets, up to 65% more.
Who should take advantage of the IPP?
Business owners, their families, key executives and professionals with professional corporations
Who is the ideal candidate?
- Business owner, incorporated professional or executive
- Age 40 – 65
- 10 + years with a corporation
- Earnings over $132,334 in T4 or T4PS income
What are the advantages and disadvantages of the IPP compared to RRSP?
The IPP advantages:
- Higher contribution amounts
- Creditor-proof assets
- Flexible benefit settlement options
- Higher investment standards
- Deficits can be made up using pre-tax dollars
- Expenses tax-deductible for the company
- Benefit to employee not taxable
The IPP disadvantages:
- No access to funds while employed
- Locked-in
- More legislation, therefore higher expenses
- Excess surplus may reduce future contributions
