2020-0842291C6 CALU 2020 – Q9 - Newsletter on s. 147.4 annuities

Principal Issues: Can CRA provide an update on the status of the draft newsletter on annuities and when it is expected to be published?

Position: Registered Plans Directorate anticipates that the final version of the newsletter will be on the Canada Revenue Agency website in the summer of 2020.

Reasons: Due to delay in the discussions between the RPD and other government regulators relative to their pension benefits standards legislation.

Author: Odubella, Darren
Section: -

2020 CALU CRA Roundtable – July 2020

Question 9 - CRA Newsletter on section 147.4 annuities

Background

In December 2018, the Registered Plans Directorate (RPD) issued a draft newsletter for industry consultation relating to registered annuities issued under section 147.4, Conference for Advanced Life Underwriting (CALU) welcomed the efforts of the RPD to provide more clarity on what conditions need to be satisfied in order for a third-party annuity, which is acquired in satisfaction of a member's rights to benefits under a registered pension plan, to qualify under section 147.4.

CALU provided a submission to the RPD, indicating its support for this important initiative. The submission also provided some additional comments and recommendations which address key issues and considerations for plan administrators and members where the acquisition of a third-party annuity is being contemplated. We understand that the draft newsletter has been delayed due to the ongoing consideration of certain pension regulatory elements.

Question

Can CRA provide an update on the status of the draft newsletter on annuities and when it is expected to be published?

CRA Response

The RPD received many submissions from industry representatives, including CALU, that were supportive of this initiative. The RPD appreciates this support as well as the recommendations and has incorporated numerous suggestions received into an updated version of the Newsletter. Finalizing the Newsletter has been somewhat delayed due to continued discussions between the RPD and other government regulators relative to their pension benefits standards legislation. These discussions have recently concluded and, subject to resource availability caused by the current pandemic, RPD anticipates that the final version of the Newsletter will be on the CRA website in the summer of 2020.

Note: The Newsletter was published on July 24, 2020. https://www.canada.ca/en/revenue-agency/services/tax/registered-plans-administrators/newsletters-technical-manual/no-20-1.html

Prepared by:

Jeff Boxer
Manager, Technical Services
Registered Plans Directorate
Legislative Policy and Regulatory Affairs Branch

Darren Odubella
July 8, 2020
2020-084229

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