The PPP is a registered pension plan for a single member, designed specifically for business owners. It offers higher tax deduction and allows for the maximization of retirement savings under current legislation. The PPP is a sound alternative to RRSP’s and is one of the best kept secrets in retirement planning for entrepreneurs.

The Insured Retirement Plan (IRP) is a financial planning concept that utilizes the potential to accumulate funds, on a tax deferred basis, inside an exempt life insurance policy. Essentially, the IRP places an insurance wrapper around your investments which converts taxable income into tax sheltered growth. At retirement, the assets in the plan are used as collateral to obtain a series of annual non-taxable bank loans. Loan interest and principle do not have to be repaid until death, at which time, the bank deducts the amount owing from the tax-free life insurance proceeds. Any remaining balance is paid to your beneficiaries.

A plan which allows a 100% tax deductible deposit from the corporation into an RCA on behalf of a business owner or key executive. The funds are not taxable until they are withdrawn in retirement. RCAs provide a disciplined and orderly way for employers to help key people fund their retirement in a tax effective manner and do not affect RRSP or individual pension plan contribution limits. They are exempt from payroll taxes, compound tax free, creditor proof and are not subject to probate fees. An RCA is frequently overlooked in planning executive compensation.

A financial planning strategy that allows you to tax shelter retained earnings and have them pass to your heirs tax free, when you die.

An arrangement where the company purchases a life insurance policy and immediately borrows back the premiums from the bank. The strategy creates ongoing tax deductions for the company and allows for large payments to your heirs, mostly if not all, tax free.

An arrangement that allows a critical illness policy to be held jointly between your company and yourself. In the event of a critical illness (such as heart attack, stroke or cancer) the benefit is paid to your company tax free. If no claim is made, after a defined period, all premiums paid are returned to you personally, tax free.

A structure used by an employer to fund group sickness or accident benefits, private health services plan benefits or group term life insurance benefits for employees or former employees.

Part of a ELHT where the employer reimburses employees for medical expenses, as defined in the income tax act, which becomes deductible to the company. Allows for a deduction of medical expenses in the corporation rather than as a medical expense personally. A PHSP is a more flexible and less costly alternative to Group Health and Dental Plans.

A Medical Trust (MT) is a new hybrid plan combining the features of an Employee Life & Health Trust (ELHT) and a Private Health Services Plan (PHSP). The Medical Trust is an arrangement, established under the Income Tax Act, between an employer and its employees where the employer agrees to provide one or more benefits for employees and/or their families. The corporation makes tax deductible contributions to the trust to reimburse the expenses incurred in providing the benefits.

A HCSA is a more flexible and less costly alternative to Group Health and Dental Plans. It is a predetermined amount of money provided to each employee for coverage of their health and dental expenses.

Ensures that you have the funds available to buy out a partner in the event of their death or incapacity.

An arrangement to compensate the business for financial losses realized from the death or incapacity of an important member of the business, including the owner.

A DPSP gives an employer the option of linking plan contributions to the profitability of the business. On a periodic basis, the employer shares business profits with employees by contributing to the DPSP on each employee’s behalf. Employees do not contribute to DPSPs. There is no minimum required contribution, so if there is a negligible profit in any year, the employer is not required to contribute. However, DPSPs are subject to maximum contribution limits set by CRA. This plan type is only available as a group arrangement and is usually offered in conjunction with a Group Registered Retirement Savings Plan (RRSP).