Deferred Profit Sharing Plan (DPSP) & Group RRSP 

A combination of a deferred profit sharing plan (DPSP) and a Group RRSP allows the company to take advantage of the features of both plans.

The employer contributions are made to the deferred profit sharing plan (DPSP) while employee contributions are made into the group RRSP. The employer contributions can be made contingent upon the employee contributing into their group RRSP.

Plan Design:

1. No minimum employer contributions;

2. Employer contributions to the deferred profit sharing plan (DPSP) are not subject to payroll taxes;

3. The employer may impose a vesting period of up to 2 years on their deferred profit sharing plan (DPSP) contribution only;

4. Withdrawals can be restricted to termination, death, or retirement on the deferred profit sharing plan (DPSP);

5. Owners or relatives of owners cannot participate in the deferred profit sharing plan (DPSP) portion;

6. Terminated employees can withdraw the full vested amount subject to taxation;

7. The deferred profit sharing plan (DPSP) creates a Pension Adjustment;

8. The deferred profit sharing plan (DPSP) can be used to share profits with employees or as a pension plan;

9. Employer and employee contributions can be made in any combination but cannot exceed an individual's personal RRSP limit;

10. Creditor-proof – to the extent provided for under applicable legislation, pension plan contributions and benefits cannot be seized by creditors.

Contact Us to Set up or Review Your Deferred Profit Sharing Plan & Group RRSP

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