Choose province (Canada) or state (United States), and language

Online services – AccèsD, AccèsD Affaires, online brokerage, full service brokerage.

Log on to Desjardins online services.
 

You are here: Home > Personal > Savings and investment > Tax-sheltered plans > Individual pension plan (IPP)

Your browser is configured to not accept cookies. Some features of the site are not available or will not work correctly without cookies. Also, some information presented might not apply to your situation.
See How to enable cookies

Your browser is not supported by our website. Some features of the site are not available or will not work correctly.
See the procedure to update your browser.

Microsoft Edge causes problems on AccèsD. To fix the issue, please install the most recent Windows update.

Individual pension plan (IPP)

Contributions are higher than the maximum allowable for RRSPs

  • A defined benefit pension plan designed for a single individual.
  • For business owners and high income earners

Target client

  • A business owner or senior executive aged 45 and over
  • A salary of $75,000 or over
  • Owns directly or indirectly at least 10% of the shares of the company
  • Has accumulated years of service prior to plan inception that create contribution eligibility

Plan type

  • Business: contributions are paid by the employer
  • Defined benefit: benefits are predetermined (an actuary calculates the contributions to guarantee the amount)

Taxation

Contributions are deductible from business income

Advantages

High contributions

  • You can contribute more than RRSP allowable contributions.
  • Retirement income is guaranteed based on the expected benefit of the plan.

Optimized capital

  • You can buy back years of service prior to plan inception.
  • The cost is shared between the participant (through RRSP contributions up to plan inception) and the business.
  • The employer's share is deductible from business income.

Shortfalls caught up

  • An actuarial valuation takes place every 4 years.
  • Any shortfall is paid up by the business, immediately or over several years.

Drawbacks

  • Administrative costs and requirements are involved.
  • The services of an actuary are required.

Learn more about the Individual Pension Plan (IPP)

Toolbar