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Income Tax Regulations

Version of section 8516 from 2010-07-12 to 2024-05-01:

  •  (1) For the purposes of subsection 147.2(2) of the Act, a contribution described in subsection (2) or (3) is a prescribed contribution.

Funding on Termination Basis
  • (2) A contribution that is made by an employer to a registered pension plan is described in this subsection if

    • (a) the contribution is made pursuant to a recommendation by an actuary in whose opinion the contribution is required to be made so that, if the plan is terminated immediately after the contribution is made, it will have sufficient assets to pay benefits accrued under the defined benefit provisions of the plan, as registered, to the time the contribution is made;

    • (b) the recommendation is based on an actuarial valuation that complies with the following conditions:

      • (i) the effective date of the valuation is not more than four years before the day on which the contribution is made,

      • (ii) all assumptions made for the purposes of the valuation are reasonable at the time the valuation is prepared and at the time the contribution is made,

      • (iii) the valuation is prepared in accordance with generally accepted actuarial principles applicable with respect to a valuation prepared on the basis that a plan will be terminated, and

      • (iv) where more than one employer participates in the plan, assets and actuarial liabilities are apportioned in a reasonable manner among participating employers;

    • (c) the recommendation is approved by the Minister; and

    • (d) at the time the contribution is made, the plan is not a designated plan.

Contributions Required by Pension Benefits Legislation
  • (3) A contribution that is made by an employer to a registered pension plan is described in this subsection if

    • (a) the contribution

      • (i) is required to be made to comply with the Pension Benefits Standards Act, 1985 or a similar law of a province,

      • (ii) is made in respect of benefits under the defined benefit provisions of the plan as registered, and

      • (iii) is made pursuant to a recommendation by an actuary;

    • (b) the recommendation is based on an actuarial valuation that complies with the following conditions:

      • (i) the effective date of the valuation is not more than four years before the day on which the contribution is made,

      • (ii) all assumptions made for the purposes of the valuation are reasonable at the time the valuation is prepared and at the time the contribution is made, and

      • (iii) where more than one employer participates in the plan, assets and actuarial liabilities are apportioned in a reasonable manner among participating employers;

    • (c) the recommendation is approved by the Minister; and

    • (d) at the time the contribution is made, the plan is not a designated plan.

  • (4) [Repealed, 2010, c. 12, s. 25]

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • SOR/92-51, s. 7
  • SOR/95-64, s. 18
  • SOR/99-9, s. 25
  • SOR/2003-328, s. 10
  • 2007, c. 35, s. 87
  • 2010, c. 12, s. 25

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