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QAFP > Registered Plans/Retirement > Flashcards

Registered Plans/Retirement Flashcards

1
Q

Qualifying factor formula

A

Age + years of service

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2
Q

What are the amounts of Canada Learning Bond (CLB)? What is the lifetime max?

A

$500 in first year, then $100 per year afterwards, up to $2,000 lifetime max

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3
Q

Is Canada Child Benefit amount affected by age?

A

Yes. Kids under age 6 get a higher benefit.

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4
Q

How to calculate DB pension?

A

Qualifying factor x years of service x salary

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5
Q

What is one’s CPP lump sum death benefit amount?

A

6x deceased spouse’s CPP or max of $2500

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6
Q

Earliest retirement age formula

A

[Member’s age when joining the plan + the Qualifying Factor] divided by 2)

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7
Q

How to calculate CPP contributions?

A

(annual salary-basic exemption) x employee cont % DON’T FORGET TO SUBTRACT BASIC EXEMPTION OF $3,500
Contribution is 5.45% or double that for self-employed individuals

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8
Q

Fixed Term Annuity

A

provides payments for a specific amount of time. If you die within that time, a specified amount goes to your estate/spouse

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9
Q

Term certain annuity

A

Based on a pre-determined need for a certain number of years (ie. funding education). If you die, it goes to your estate. No beneficiary can be named. Fixed interest rate for the entire term.

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10
Q

Life Straight Annuity/Single Life Annuity

A

For a single person. Pays the largest benefit of all annuity types. When the person dies, payments stop.

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11
Q

Life Annuities with Guarantees

A

Pays annuitant for the rest of their life, but if they die within the guarantee period, their beneficiary will get either a death benefit, or continued annuity payments for the guaranteed period.

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12
Q

Temporary annuity

A

Pays until the earliest of
1) end of term
2) mortality of annuitant

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13
Q

Which is usually better: career average or final average DB pension?

A

Final average (or best average)

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14
Q

What impact does a guarantee on a life annuity have on the annuity payments?

A

Lower payments

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15
Q

If you are married, how do you go about splitting CPP benefits?

A

Both spouses must apply

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16
Q

If you are divorced, how do you go about splitting CPP benefits?

A

When divorced, only one of the spouses needs to make the application. CPP credit splitting can be done through separation agreement, court order, or application to CPP.

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17
Q

Can employees contribute to a DPSP?

A

No

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18
Q

Vesting period for DPSP?

A

Two years

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19
Q

Does DPSP cause a PA?

A

Yes

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20
Q

Can you transfer a DPSP?

A

Yes, to your RRSP

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21
Q

Prescribed annuity

A

Levels out tax evenly over the course of the annuity.

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22
Q

What does a life insurance trust do?

A

Handles a trust after death which has the proceeds of life insurance. Can help professionally manage money for a disabled orphan, for example.

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23
Q

Can you hold a mortgage in your RRSP?

A

Yes, but it has many associated fees.

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24
Q

Tax implications of employer’s contribution to Group RRSP?

A

Taxable benefit to employee - taxed fully as earned income.

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25
Q

Retiring allowance rollover

A

$2000 per year of service prior to 1996 can be rolled over to RSP without affecting contribution room

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26
Q

Insured Annuity

A

A combination of a life annuity and permanent life insurance. You can get cash flow from it but also provide funds to a beneficiary after you die.

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27
Q

When does the OAS payment schedule begin?

A

July - June

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28
Q

What is the maximum CCB per child per year?

A

$6833

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29
Q

Is CCB taxable?

A

No

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30
Q

Early RRIF formula (before 71)

A

RRIF Amt/(90-age)

31
Q

DB Pension Adjustment

A

(Benefit entitlement x 9) - 600

32
Q

Amount deducted if you take early CPP?

A

0.6% per month

33
Q

Amount added if you take late CPP?

A

0.7% per month

34
Q

Amount added if you take late OAS?

A

0.6% per month

35
Q

Dividend tax credit for eligible dividends?

A

38% gross up, 15% credit

36
Q

Dividend tax credit for non-eligible dividends?

A

15% gross up, 9% credit

37
Q

What is the OAS clawback amount?

A

15%

38
Q

GIS Clawback details

A

Clawback starts at $1 of income.
OAS and GIS do not count as income.
First $5,000 of employment income and half of the next $10,000 is exempt.
(assume approx 50 cent clawback on each dollar)

39
Q

CPP Survivor Benefits for spouse under age 65

A

37.5% of deceased’s CPP + $200/mo flat benefit

40
Q

CPP Survivor Benefits for spouse over age 65

A

60% of deceased’s CPP, based on retirement age (if you are not earning CPP) but cannot get more than the max CPP amount if you are receiving CPP

41
Q

Are CPP survivor benefits taxable?

A

Yes

42
Q

Do you contribute to CPP if you are receiving CPP disability?

A

No

43
Q

What years can be excluded from your CPP calculation?

A

7 childbearing years (per child, with overlap) and periods of disability and worst 17% of contribution years

44
Q

What is the max annual CPP one can receive?

A

Approx $14,500/yr, $1200/mo

45
Q

Is CPP tax deductible for employers?

A

Yes

46
Q

What is the max OAS one can receive?

A

Approx $7500/yr

47
Q

What are the requirements to receive OAS?

A

Minimum 10 years of residency after age 18

48
Q

What are the residency requirements for full OAS benefit?

A

40 years residency

49
Q

What is the max GIS amount one can receive?

A

$11,000/yr

50
Q

Are there any residency requirements for GIS?

A

No, just must be receiving OAS

51
Q

What is the range of EI coverage?

A

14-45 weeks with minimum 1 week waiting period
Regular, maternity, parental, sickness, compassionate care, caregiver, parents of critically ill children

52
Q

What is the penalty for overcontributions to TFSA/RSP?

A

1% per month on overcontributions, plus 100% on investment returns of the overcontributions

53
Q

How long do funds need to be in an RRSP before using FTHBP?

A

90 days

54
Q

Is the $2,000 RRSP overcontribution tax deductible?

A

No

55
Q

What happens if AIP cannot be rolled over to subscriber’s RSP?

A

Subscriber is taxed at their marginal rate plus 20% punitive tax

56
Q

RDSP lifetime contribution limit?

A

$200,000

57
Q

Maximum RDSP grant that can be received?

A

$70,000

58
Q

Maximum CDSB that can be received?

A

$20,000

59
Q

Do RDSP withdrawals affect OAS?

A

No

60
Q

Max CDSB per year?

A

$1,000 if you make under $30k

61
Q

How much retroactive CDSB can you get and how far back can you go?

A

Max $10,000, going 10 years back

62
Q

What is the maximum age you can receive CDSG?

A

49

63
Q

How much CDSG can you ‘buy back’ from previous years?

A

$10,500

64
Q

What is a PGAP?

A

Primary Government Assistance Plan
When grants+bonds exceed contributions in an RDSP

65
Q

What is LDAP?

A

Mandatory withdrawals from RDSP starting at age 60

66
Q

What is a DAP?

A

one time withdrawal before age 60 from RDSP. May be subject to Assistance Holdback Amount if it’s a PGAP

67
Q

What counts as earned income for RRSP contribution room? (6 things)

A

net employment income, net rental income, spousal support, net business income, royalties, CPP disability

68
Q

At what age can you split DC/DB pension income?

A

Any age

69
Q

How does CPP income splitting work?

A

Can only split what you earned while together, so credits are pooled
Split 50/50
Split at source

70
Q

How does pension income splitting work?

A

Can split up to 50%. Only split on taxes, not at source. No pooling.

71
Q

How much can you withdraw for LLP? When does repayment begin and how long is repayment period?

A

$10,000 a year to a max of $20,000. Repayment starts earlier of 5th year after first withdrawal or year after you stop being a student. 10 year repayment period.

72
Q

How much can you withdraw for FTHBP? When does repayment begin and how long is repayment period?

A

$35,000. Repayment starts 2nd year after first withdrawal. 15 year repayment period.

73
Q

Post Retirement Benefits

A

If you are over 60 and receiving CPP but are still working and contributing to CPP then you get an extra benefit.

QAFP (8 decks)

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