CRA says it will release an industry-anticipated folio this spring dealing with its new position on the rules for RRSPs, RRIFs and TFSAs.
At the November 2016 Canadian Tax Foundation Conference, CRA told attendees that paying registered plan fees from non-registered accounts will incur a tax penalty equivalent to the fee.
CRA views the practice as creating an unfair advantage because it’s equivalent to a tax-free increase in the value of the registered plan. But the agency has yet to share guidance on how it will apply its new position, which comes into effect January 1, 2018.
Those details are coming.
“The CRA expects to release the income tax folio on advantages for RRSPs, RRIFs and TFSAs in the spring of 2017,” Lise Newton, spokesperson for CRA, tells Advisor.ca. “The folio will be posted on the CRA website and subject to a three-month comment period. In the meantime, the CRA is working with the investment industry in identifying the different types of fee structures and the application of the advantage rules to these structures.”
Newton says those who wish to provide comments to CRA in advance of the folio’s release can email firstname.lastname@example.org.
As anyone with a seasonal deadline knows, “spring” can mean anything between March 20 and June 20. Stay tuned.