An IPP is a maximum defined benefit plan that provides contribution amounts in excess of the RRSP limit for people who satisfy certain age and earnings criteria. That plan has financial advantages over the RRSP-only alternative for high-income earners over a certain age limit. Some sample maximum 2005 current service contributions (ie. for benefits being accrues in current year) to an IPP are as follows: |
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Age 35 |
IPP Contribution $16,800 |
Age 55 |
IPP Contribution $24,500 |
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Who can take advantage of the IPP? Key candidates for an IPP are business owners, their families key executives and professionals with Professional Corporations. The only stipulation is that the sponsoring company must be incorporated. Who is the ideal candidate? An owner, incorporated professional, or executive, age 35 or over, and earning over $100,000 in T4 or T4PS income, is the ideal candidate. However, IPP may also be established for candidates with lower earnings. What are the advantages of an IPP? - Higher contribution limits as compared to RRSP's For further information please contact Allan Strickland at the above address or by email at allan@mbutlerinsurance.com.
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