Deferred Profit Sharing Plan (DPSP)
Many employers would like to find a more cost-effective way to contribute to their employees’ retirement savings. The Deferred Profit Sharing Plan (DPSP) is a good choice, but it has traditionally been complicated to set up.
TK Wealth Management Inc., through independent providers, offers an easy way to establish a DPSP for your business. While DPSPs often require slightly higher contributions from employers than Group RRSPs, they can offer additional benefits you cannot achieve through making contributions to a Group RRSP.
Lower Your Company’s Taxes
Your company’s taxable earnings are calculated after you’ve made contributions to your employees’ DPSP accounts. Any contribution you make towards your employees’ DPSPs actually reduces your company’s taxable earnings.
Lower Your Payroll Taxes
Employer contributions to a DPSP are exempt from federal payroll taxes, including Canada Pension Plan, Employment Insurance and other applicable provincial payroll taxes. In addition, DPSP contributions are not a taxable benefit to your employees. This could mean additional savings.
Profit-sharing plans give your employees a direct stake in your company’s results. There’s no better way for a company to get top performance from their employees.
Retain Employees with Vesting
If you want to retain good employees, give them a reason to commit to your business. Your Deferred Profit Sharing Plan can be designed with a vesting schedule that encourages long-term thinking.
You decide how much and how often you’ll contribute.