SPP Membership Guide - Saskatchewan Pension Plan
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SPP Membership Guide
SaskPension.com
Thank you for taking the time to review this information
about Saskatchewan Pension Plan (SPP). We hope you will
decide to participate with the 33,000 people who are already
part of this plan.
If you have any questions that this Guide does not answer,
we would be pleased to help you.
CALL 1-800-667-7153 anywhere in Canada
Collect 1-306-463-5410 anywhere outside Canada
FAX 1-306-463-3500
WRITE Box 5555, Kindersley, SK S0L 1S0
EMAIL info@saskpension.com
TELETYPE 1-888-213-1311 anywhere in Canada
WEB SaskPension.com
Visit our website at SaskPension.com to access important
information, the wealth calculator, your online account
(MySPP), and the following SPP forms:
• Membership application • Newsletters
• Transfer-in form • Annual Report
• Fund facts
1-800-667-7153
Reasons You Should Join the
Saskatchewan Pension Plan
• It’s affordable. Indexed annually, the Start Saving Today
2021 maximum is $6,600. Check
SaskPension.com for current It’s never too early to start planning
maximum contribution. The plan has for your future. Have you ever
several payment options designed considered what you will be doing
to suit your budget. You can also when you retire? Will you be able
transfer up to $10,000 per calendar to realize your retirement goals
year into your SPP account from with the financial resources you
your existing Registered Retirement are setting aside? SPP is designed
Savings Plan (RRSP) or Registered to assist people, just like you, who
Retirement Income Fund (RRIF). want a comfortable income during
their retirement. Whether you are a
• It’s flexible. Contributions to the business owner, farmer, professional,
plan are voluntary, so you are able homemaker, student, or part-time or
to start and stop contributing at any full-time employee, as long as you
time without penalty. have RRSP contribution room, SPP
can help you save for your future.
• It’s designed to benefit you. SPP’s
expense ratio is typically less than SPP is a powerful savings vehicle
one per cent, compared to RRSP because your contributions are tax
products which are often at two per deductible and the taxes on any
cent or more. This professionally investment growth are deferred
managed fund has averaged over until you take your money out.
eight per cent since inception. Tax-deductible contributions mean
you will have more of your income
• It’s easy to implement and available for your current needs, while
maintain. If you are between 18 and you are saving for the future. And
71, all you need to do to set up your tax-deferred investment growth keeps
account is complete a simple more of your money working for you.
application and begin contributing.
Becoming a member of SPP is the
• It can save you money. Not only will first step to using the plan as part of
you save for retirement,* your your retirement savings strategy. SPP
contribution can be used as a is flexible and affordable. The plan is
deduction on your income tax.** funded by member contributions
and investment earnings; at
December 31, 2017 there was
$525.8 million in assets under
**SPP is a pension plan; therefore your
management. SPP is administered by
account is locked in until you reach
age 55. a Board of Trustees, some of whom
are also plan members. Funds in the
**SPP follows the same rules as an RRSP;
to contribute, you must have unused plan are professionally managed and
RRSP contribution room. earn a competitive return each year.
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SaskPension.com
Michael and Sarah are a thirty-something couple
who want to start some kind of retirement savings.
They do not currently have a plan available to them,
such as a company pension plan.
1-800-667-7153
Investment Options
All contributions to SPP are invested capital. It is suitable for members
for you by independent, professional who are near retirement and have
investment managers, who must reached their retirement savings
follow the investment policy goal, or members who wish to have
developed by the Board of Trustees a cash equivalent component in
for each fund. This policy establishes their investment portfolio. The STF
the asset mix strategy, or the fund’s only invests in high-quality Canadian
allocation to different asset classes, money-market instruments such
based on the fund’s risk level. It is as commercial paper, bankers’
through the asset allocation decision, acceptances and treasury bills.
SPP diversifies its investments across This money market fund is expected
asset classes and attempts to to produce a return similar to
balance risk and reward in each prevailing T-bill rates in Canada.
fund. The complete statement of
investment policies and goals is Choosing Investment Funds
available on our website or by
calling the toll-free line and As a member, you choose where to
requesting a copy. invest your money. The default fund is
the BF. If you do not provide direction,
your money is deposited to the BF.
Balanced Fund You may choose to have your
The Balanced Fund (BF) is a low to investment in one fund or the other,
moderate risk/return investment or a portion in each. Your directive
option. The objective of this fund is can be changed as your goals and
to provide long-term capital growth investment objectives change.
in a risk-controlled manner. The BF
invests in a broadly diversified Before you invest or make any change
portfolio of equities, bonds, to the way your pension funds are
infrastructure and real estate. invested, it is wise to review the
Approximately 55 per cent of investment choice pamphlet and
the fund is invested in equities, fund facts sheets. To change your
33 per cent in fixed income directive, go to SPP’s website or call our
investments and 12 per cent in toll-free line to obtain a transfer and
alternative investments. It is also investment instruction form. Your first
diversified by individual investments two interfund transfers in the calendar
within each asset class, by investment year are free. A $50 fee applies to
manager style and by geographical subsequent transfers in the year.
location. The BF is the plan’s default High
fund for those who do not explicitly Equities
state their investment preference(s). Infrastructure
Real Estate
Short-term Fund Balanced Fund
Return
Bonds
The Short-term Fund (STF) is a low Mortgages
risk/low return investment option. Cash
Its primary purpose is to preserve
Low High
Risk
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Maximizing Your Benefits Your social insurance number (SIN)
is required on the application form
Contributing regularly gives you the
as we will need to issue tax receipts
benefit of time. Your savings grow
or T4As for you to file with your income
tax sheltered and the longer your
tax return. The information collected
money stays in the plan, potentially
on your member application is used
the greater your retirement account
for administering your account and
will be. That is why it is important
for collecting general statistics about
to start contributing early, as even
the plan.
a small, consistent contribution
will be able to grow and grow.
When you join SPP, you are required
to name a beneficiary for your
Earnings Allocation account. In the event that you die
Each month, SPP allocates 100 per before you begin receiving retirement
cent of the earnings, less operating payments from SPP, the funds in
expenses, to members. Each fund your account will be paid to the
is subject to market forces and as beneficiary you have named.
market returns rise and fall, so will SPP
earnings. Earnings on your account You can change your beneficiary at
begin immediately and compound any time. Detailed information about
monthly. The table below projects the choosing your beneficiary starts on
growth of contributions and earnings. page 7.
Account Balances
It is important to sign your application
8% & $3,000/year
form. Application forms are valid
YEARS BALANCE
only with your original signature.
10 years $45,198
For that reason, you need to mail
20 years $142,777
your signed application to SPP. You
30 years $353,443
may submit your contribution with
your application. SPP will assign you
Joining SPP an account number when your
Joining SPP is simple. All you need application is processed.
to do is complete the membership
application included in this booklet Privacy
or use the online application process,
SPP collects only the personal
attach proof of age, and mail both
information necessary to administer
to SPP.
our program. Our privacy policy
stipulates that personal information
Proof of age could be a photocopy
can be disclosed only to the member.
of your birth certificate, your driver’s
Exceptions may be made if there is
licence, or a Canadian passport.
written consent from the member.
If none of these documents are
If you have questions about SPP’s
available or if your document is
privacy policy, please call the
written in a language other than
toll-free line.
English or French, please contact
SPP for further information.
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1-800-667-7153
Contributing to SPP contribute to your account until the
end of the year you turn 71 or until
You may contribute any amount
you begin receiving income from
to a maximum of $6,600 per tax year
your SPP account, whichever is earlier,
with annual indexing starting
provided the contributor has RRSP
January 1, 2019. Contributions can
deduction room. You can continue
be made using the schedule and
contributing to the plan if you are
payment method of your choice and
receiving other retirement income or
within your unused RRSP contribution
SPP survivor benefits. Contributions to
room.You have the calendar year
your account are locked in until age
plus the first sixty days of the next
55 and earn interest until you retire.
year to contribute for each tax year.
If you die before you retire, the funds
in your account will be paid to your
Your SPP account is tax sheltered.You
beneficiary or estate. Your money
or your contributing spouse may be
is protected from claim or seizure
able to use your contribution as a tax
except in the event of an order under
deduction.Tax deduction guidelines
a marital division or an enforcement
are explained in more detail on
of maintenance order.
page 7. You or your spouse can
Since their income varies from month to month,
the couple decided to join Saskatchewan Pension
Plan. The plan’s flexibility allows them to contribute
as much as they want when they can, up to the
annual maximum.
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Michael and Sarah like the fact that SPP is well
managed, strictly regulated and follows a careful,
“steady-as-you-go” investment philosophy focused
on the long term.
Payment Methods schedule.The pre-authorized
credit card application is available
1. When you join the pre-authorized on the website and can be done
contribution (PAC) program, your on a semi-monthly or monthly
contributions are made directly basis.
from your bank account on a
prearranged schedule. This 3. Many financial institutions offer
schedule can be either the 1st or services for making payments.
15th of the month on a semi- In most cases, your SPP contribution
monthly or monthly basis. Your can be made using in branch,
PAC is applied to the calendar online or telephone services. Please
year in which it is received. The contact your financial institution
PAC application is located on the for information on these methods
back of the member application. and charges that may be incurred.
2. You can make your contribution 4. Your contributions can be made
with VISA® or MasterCard® online by mail to SPP. Simply include your
at SaskPension.com, by calling or account number on your cheque
visiting SPP, or by a pre-arranged when mailing the contribution
to SPP.
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1-800-667-7153
Additional Information
MySPP SPP contributions should be claimed
on line 208 of your tax return.
When your account is created, you
Contributions to SPP will be taken
will be able to set up secure, online
into account in determining RRSP
access to your member account
over-contributions.
information in order to track deposits
and obtain information slips for
Both your application and your
tax filing purposes.
contribution must be received by SPP
before a tax receipt will be issued.
Spousal Contributions
In order for your spouse to use the Choosing a Beneficiary
contributions as an income tax
If you name your spouse as
deduction, complete the spousal
beneficiary of your account, Canada
information on your contribution
Revenue Agency (CRA) allows death
form, PAC application or online
benefits to be transferred, tax-deferred,
contribution. The telebanking
directly to his or her SPP account or
and electronic systems do not
to an RRSP, RRIF, or guaranteed Life
forward spousal information to SPP.
Annuity Contract (LAC).
Contributions made using these
methods may still be deducted by In addition to spousal rollover of SPP
your spouse if you call or write SPP death benefits, rollovers to an RRSP or
with your request at the time the Registered Disability Savings Plan for
contribution is made. Please include a financially dependent infirm child
your spouse’s full name and SIN or grandchild are permitted.
with your request. Spousal attribution
rules may apply to contributions For all beneficiaries, including your
made to SPP. spouse, death benefits received as
cash become taxable income in
Tax Considerations the year received. The beneficiary
or estate will receive a T4A to file with
Contributions and all earnings
his or her income tax return. The T4A
remain tax sheltered until drawn as
provides the beneficiary or estate
a pension or paid as a death benefit.
with the total amount of the death
benefit and the amount of tax paid
SPP contributions are subject to the
to CRA on their behalf. The amount
same rules as RRSP contributions.
of withholding tax is determined by
Your SPP contribution is tax
CRA using the schedule below. For
deductible by you or your spouse,
example, if your account balance
if he or she contributed for you.
is $9,000 when you die and your
This deduction will be allowed if
beneficiary chooses to take the
the person claiming it has RRSP
payment in cash, your beneficiary
contribution room. The spousal
will receive a cheque for $7,200 and
designation must be made when
$1,800 of withholding tax will be sent
the contribution is deposited.
to CRA on your beneficiary’s behalf.
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SaskPension.com
Account Balance Tax Rate • If you name minor children as
PROVINCES QUEBEC beneficiaries, SPP will consult
$5,000 or less 10% 5% the Public Guardian and Trustee
$5,001 to $15,000 20% 10% of Saskatchewan if a death
More than $15,000 30% 15% benefit becomes payable. It is
recommended you seek legal
It is your responsibility to ensure that advice when naming a minor
your beneficiary information is up-to- as beneficiary.
date and reflects your intentions.
Changes in your marital or family
Retiring from SPP
status or changes to the status of Please call SPP prior to retirement
a minor may necessitate an update to receive detailed information on
of your beneficiary information. pension options. This will ensure you
Should you wish to change your select the option that best matches
beneficiary, you will require a your situation and needs.
designation of beneficiary form,
available at SaskPension.com or by When you retire from SPP, you have
calling the SPP office. Your beneficiary several options:
will receive the balance of your • Purchase an SPP annuity, which
account if your death occurs before provides a monthly pension
you receive a pension from SPP. payment for your lifetime;
• Transfer your account balance to
You may wish to seek legal advice a Locked-in Retirement Account
regarding your designation of (LIRA), Prescribed Registered
beneficiary, especially if naming Retirement Income Fund (PRRIF)
a minor child. or LAC at another financial
institution; or
Some factors to consider when • A combination of the annuity and
naming a beneficiary include: transfer options.
• If you are naming more than one • A variable benefit option is
person as beneficiary, it is important anticipated to be available in 2019.
that you indicate what share of
your account each beneficiary is You may retire from SPP between
to receive. The share of a deceased the ages of 55 and 71 regardless
beneficiary will be paid to the of your employment status. You must
surviving beneficiary(ies) unless apply for SPP retirement benefits; the
otherwise indicated. package to make this application is
• When your estate is named, the available by calling SPP. The package
funds are paid to the estate, less contains the required application
withholding tax. It is then part of forms and an estimate of your
the money used to settle debts pension for the annuities SPP offers.
of the estate, and the balance is
distributed according to the terms If you choose to receive an annuity
in your will. from SPP, the amount of your pension
81-800-667-7153
will depend on the type of annuity provide a personal pension estimate
you select, your account balance, for you upon request.
the current interest and annuity rates,
your age and your spouse’s age, SPP annuity income qualifies for
if applicable. pension income splitting and
the pension income credit.
Some annuity options available from More information regarding
SPP may provide payments to a retirement options is available
beneficiary or surviving spouse after at SaskPension.com or in our
your death. We will be pleased to retirement guide.
Some annuity examples based on typical account balances*
ACCOUNT BALANCE MONTHLY PAYMENT ANNUAL PAYMENT TOTAL RECEIVED IN 20 YEARS
$50,000 $279 $3,348 $66,960
$100,000 $558 $6,696 $133,920
$150,000 $838 $10,056 $201,120
*Assumes the pension starts at age 65 and the Life only annuity is chosen.
Starting out with SPP, they chose to put their
contributions into the BF (Balanced Fund) because
they’re young and a long way from retirement. As
they get closer to retirement, they know they can
transfer some or all of their savings into a lower-risk
STF (Short-term Fund).SaskPension.com
Michael and Sarah can review their plan and
comfort level from time to time to see which
fund, or combination of funds, is best for their
current situation.
When they joined SPP, both Michael and Sarah
needed to name a beneficiary. They named each
other, knowing they could name anyone, and
that there is the option to change their beneficiary
at any time.
101-800-667-7153 Once their income becomes more predictable, the couple plans to use the pre-authorized contribution (PAC) program, where a set amount is transferred to SPP from their bank account each month. It’s a great way to ensure contribution of the maximum allowable amount of $6,600 per year, indexed each year. For now, Michael uses his credit card to contribute online when he has extra funds, while Sarah usually contributes when she visits her bank, or through her bank’s online payment services. 11
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Implementing an Initial Refund Period
Employer Plan For first-time contributors who
By joining SPP, employers and decide the plan does not meet their
employees have all the benefits of retirement planning needs, there
an employer-sponsored pension is a 60 day initial refund period.
plan without the costs. The set-up Members may receive a refund of
paperwork is easy and SPP will help their account if they change their
the company complete it. After that, mind within 60 days of their date of
the employer simply issues a cheque. application or their first contribution,
Contributions can be made by the whichever is later.
employer as an employee benefit, by
the employee as a payroll deduction, Marital Division
or a combination of both. Regardless
If your account becomes part of a
of who makes the contribution, the
settlement in a division of property
total must not exceed the $6,600
due to the breakdown of a spousal
annual indexed limit.
relationship, it will be divided as
specified in the family property
The employer contributions are
division agreement or separation
deductible as a salary expense,
agreement and interspousal
and employees may deduct the
contract. The receiving spouse must
total contribution within RRSP limits.
become a member of the plan
Funds are locked in until age 55
for the division to be completed.
to provide income at retirement.
The funds in both accounts remain
locked in until retirement. Both parties
Please contact the SPP office if you
have the opportunity to add to their
or your employer would like further
account if they wish.
information about the employer plan
or to arrange a presentation at
your workplace. Maintenance Orders
SPP account balances and pension
Transfers to SPP payments are subject to attachment
under The Enforcement of
You can make a direct transfer up to
Maintenance Orders Act, 1997.
$10,000 per calendar year into your
SPP will act as specified in the
SPP account from an RRSP or RRIF.
notice of attachment.
Transfers in are subject to all plan
rules including the lock-in provision.
Since these are direct transfers, Plan Governance
there are no tax implications. Your SPP is governed by The
financial institution may charge Saskatchewan Pension Plan Act;
a fee for transferring funds to SPP. if any discrepancy arises between
the information contained in this
The form to initiate a transfer to SPP guide and the Act, the Act will prevail.
is available by calling SPP or by
downloading it from our website.
121-800-667-7153
It’s important to Michael and Sarah that, as
income earners, their SPP contributions are
tax deductible according to CRA guidelines.
13SaskPension.com
Sarah knows first-hand the benefits of SPP. Her father
retired from the plan this year, at age 62. Rather than
choosing between the two options of (a) purchasing
an SPP annuity, which provides a monthly payment
over your lifetime, or (b) transferring his SPP account
balance to another fund at another institution, Sarah’s
father opted for a combination of these options.
141-800-667-7153
Common Questions
Q: What is the plan’s rate of return? You can contribute monthly,
A: As of December 31, 2017, the annually or on whatever schedule
plan returned 8.1 per cent since you choose, up to the annual
it started in 1986. The ten-year indexed limit ($6,600 in 2021).
return is 5.7 per cent and the The earlier you contribute in the
five-year return is 9.4 per cent. year, the greater the earnings
Please check SaskPension.com you could potentially receive on
for current rates. your investment.
Q: Who can use my SPP contribution Q: Can I contribute if I don’t have
for a tax deduction? unused RRSP contribution
room?
A: SPP contributions may be
claimed by you or your spouse A: No. As of 2010, SPP contributions
within CRA guidelines. The person are subject to the RRSP rules
using the contribution as a tax set out in the Income Tax Act.
deduction must have unused In order to contribute to SPP for
RRSP contribution room. Spousal yourself or your spouse, you must
contributions must be deemed have unused RRSP contribution
as such when made. If the room. CRA calculates your
contributor has unused RRSP available RRSP room for you
contribution room, he or she and reports it on the notice
may contribute and receive a of assessment you receive
tax deduction for contributions after filing your tax return. The
to both their personal and their available room is calculated
spousal account. based on earned income as
defined by the CRA (e.g., wages,
Contribution forms and PAC self-employment income, net
applications have a spousal rental income, and taxable
information section. support payments). Even for SPP
accounts that existed prior to
Q: How do I make my contribution? 2010, future contributions must
A: Several methods of payment now adhere to the RRSP rules.
are available:
• Directly from your bank Q: Do I have to contribute the
account or credit card using same amount each year?
the PAC system on the 1st or A: SPP is designed to be very
15th of the month using a flexible and to accommodate
semi-monthly or monthly your individual financial
schedule circumstances. There is no
• VISA® or MasterCard® online at minimum contribution. Even
SaskPension.com or by calling contributing $10 per month
toll free, 1-800-667-7153 will build your SPP account
• At financial institutions, and provide you with additional
in branch or online pension at retirement. The
maximum contribution in 2021
• Mailing directly to the SPP
is $6,600. This maximum is
office in Kindersley
indexed and changes each
year on January 1.
15SaskPension.com
Down the line, Sarah and Michael will request a
personal pension estimate from SPP, to help with
their retirement planning. They are aware they can
retire from the plan anytime between the ages of 55
and 71, even if they’re still employed.
Q: Who will invest my money? Q: When can I expect to receive
A: SPP has independent, my tax receipt?
professional money managers. A: Contributions made during
You may choose between the the first 60 days of the year are
Balanced Fund and/or Short- receipted separately from those
term Fund for investment. In the made during the remainder of
absence of instructions from the year. All receipts are mailed
you, your contributions will be to members beginning in early
deposited to the default fund— January. Mailings continue
the Balanced Fund. on a monthly basis until all
contributions have been
Q: How do I advise SPP receipted.
regarding my investment
choice decision? Q: How much will my pension
A: The transfer and investment payment be when I retire?
instructions form allows you to A: At retirement, the amount of
transfer funds in your account your pension will be determined
between the BF and STF. by your age, and your spouse’s
Additionally, you may direct age, if applicable; your account
future contributions to the balance; the type of annuity you
funds using the same form. choose; and interest and annuity
rates. SPP expects to have a
161-800-667-7153
variable benefit option available Q: When is the contribution
in 2019. Please call the SPP office deadline?
for a personal pension estimate. A: Members have the calendar year
plus 60 days to contribute for
Q: Can I transfer funds from each tax year. Typically the
other RRSPs to SPP? contribution deadline is March 1.
A: Members may transfer up to However if that date falls on a
$10,000 per calendar year weekend it is the first business
from existing RRSPs, RRIFs and day after March 1. During a leap
unlocked pension plans. year, February 29 is the deadline.
Glossary of Terms
Annual Rate of Return – measures manager can be measured. Some
the change in market value of examples include: Dow Jones,
an investment fund over the fiscal S&P500, S&P/TSX and MSCI EAFE.
period. For SPP, the annual rate of
return measures the change in Beneficiary – person or persons
market value from January 1 to named to receive proceeds of
December 31. a member’s account at the time
of the member’s death.
Annuitant – the person receiving the
benefits of an annuity. Board of Trustees – people
responsible for operations of SPP.
Annuity – a series of payments of a One third of the trustees must be
fixed amount. SPP annuities are paid SPP members.
monthly to retired members for the
duration of the member’s life. Bond – a debt instrument with the
promise to pay a specified amount
Annuity Rate – quoted as a of interest and to return the principal
percentage, this rate reflects the amount on a specified maturity date.
return that funds earn when
an annuity is purchased. Capital Gains – the increase in value
of an asset between the time it is
Asset Mix – percentage of an bought and sold.
investment portfolio that is contained
in each permissible asset class for Compound Interest – interest that
the fund. is calculated on the principal and
previously paid interest.
Balanced Fund (BF) – SPP’s capital
accumulation fund that diversifies Contribution – payment to your SPP
investments between several asset account. Maximum contribution is
classes. Please see page 3 for indexed and changes on January 1
further details. each year (2021 maximum is
$6,600). Maximum transfer in from
Benchmark – a standard against RRSPs is $10,000 per calendar year.
which a security or investment
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CRA – Canada Revenue Agency, Earned Income – a value
formerly Revenue Canada. calculated by CRA that includes
employment earnings, self-
Death Benefit – funds paid to a employment earnings, and certain
member’s beneficiary after the other types of income. Consult
member’s death. Death benefits CRA for the entire calculation.
are available if a member dies
prior to retirement and has funds Earnings – return on investment.
in his or her account. When a
member dies after retirement, Equities – an investment class
the death benefit depends on consisting of shares in
the pension option chosen. public companies.
Default Fund – unless new Fund Facts – an easy-to-read
members inform us otherwise, their document designed to help investors
contributions are invested in the better understand the basic features
Balanced Fund. Members may of a fund and compare different
transfer from the Balanced Fund to funds they may be considering.
the Short-term Fund at any time.
Garnishee – to be taken by legal
Directive – instructions provided authority. Although, in the case of
by the member with respect to a bankruptcy, money in some funds
investment choice. can be garnisheed to pay creditors,
the only way SPP funds can be
claimed or seized is following an1-800-667-7153
order under The Enforcement of LIRA – Locked-in Retirement Account
Maintenance Orders Act, 1997. (formerly Locked-in RRSP). The LIRA
is a holding account sheltering
Indexing of Contributions – investment income until age 71. At
maximum contribution now indexed age 71, the LIRA must be converted
to YMPE and will change each to a life annuity or a prescribed
year on January 1. Please check RRIF. You cannot make further
SaskPension.com for the current contributions to a LIRA or withdraw
annual maximum contribution. funds until you choose a retirement
option, and ongoing investment
Infrastructure – an alternative decisions are required.
investment class which includes
things like wind farms, solar farms, Locked In – unable to shift or withdraw
power plants, roads and bridges. invested funds. Money invested in SPP
is locked in until age 55.
Investment – asset purchased with
the hope it will generate income or Market Value – current value of
appreciate in value. an investment.
Investment Manager – firm(s) Minor Child – child under the age
hired by SPP to make and carry of 18.
out day-to-day investment decisions
for SPP’s Board of Trustees. The Money Market – a type of fund that
investment managers report invests primarily in treasury bills and
quarterly to the Board. other low-risk short-term investments.
Pleased with his experience with SPP, Michael
mentioned SPP’s employer plan to his employer.
His boss liked the idea because it is simple to
set up (SPP does most of the legwork) and the
cost is minimal.
It’s win-win from a tax point of view. His boss can
claim the company contributions to Michael’s plan
as a salary expense, and Michael can deduct the
whole amount within his RRSP limit.
19SaskPension.com
PAC – (pre-authorized contribution) cohabiting as spouse at the relevant
direct withdrawals from a bank time and who has been cohabiting
account or credit card. continuously with the member as his
or her spouse for at least one year
Plan Year – calendar year plus 60 prior to the relevant time.
days. Contributions made in the
first 60 days of the year may be Tax Shelter – an investment upon
deducted in the prior tax year. which taxes are deferred.
Prescribed RRIF – a retirement Telebanking – a 24-hour, automated
arrangement that can be established banking service that allows you to
with funds locked in by pension make your SPP contribution from
legislation to provide annual income. your home over the phone. This
Spousal consent must be obtained service may be offered by your
before assets are transferred to a financial institution.
prescribed RRIF. The owner maintains
control of the investments and Treasury Bills – T-bills; short-term
investment earnings continue on a bonds issued by the government
tax-free basis. Ongoing investment to mature in one year or less.
decisions are required and funds
are subject to market changes. Variable Benefit – a retirement
option paid directly from a defined
Proof of Age – needed to confirm your contribution pension plan. This benefit
birth date for retirement purposes. provides flexibility and control over
Proof of age could be a photocopy when and how much retirement
of your driver’s licence, birth income to withdraw.
certificate, or a Canadian passport.
Withholding Tax – required by CRA
Real Estate – property in buildings when money is taken out of a tax
and land. shelter. Tax is deducted from the
payment and the member receives
Risk – the potential that the a T4A to include with their next tax
actual return will differ from return. See the table on page 7 for
the expected return. the rate.
RRSP Contribution Room – is Year-to-date Rate of Return –
reported on the notice of assessment a return (expressed as a %) that
you receive from CRA each year measures the gain or loss of an
after filing your tax return. investment fund from the beginning
of the fiscal year to the current date.
Short-term Fund (STF) – SPP’s Gains on investments are considered
conservative fund invested strictly in to be any income received plus
money market instruments. Please realized and unrealized gains.
see page 3 for further details.
YMPE – Year’s Maximum
Spouse – Pensionable Earnings is a figure
(i) a person who is legally married set each year by the Canadian
to a member; or government which determines the
(ii) if a member is not legally married, maximum amount on which to
a person with whom the member is base contributions to CPP/QPP.
201-800-667-7153 SPP is the right plan at the right time in Michael and Sarah’s lives. Although their contributions are small, the couple now sees investing and planning as an important part of their life. You don’t have to be rich to be a smart investor, and investing what you can now is much smarter than not investing at all.
1-800-667-7153
info@saskpension.com
Box 5555, Kindersley, SK S0L 1S0
SaskPension.com
04/18
2013.01 3M
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