Group Registered Retirement Savings Plan (GRRSP)
Ease of Contribution
Any Group RRSP member decides for themselves how much they are willing to contribute per pay period to their own RRSP plan within the company’s Group RRSP. On top of the RRSP contribution per pay (which can be either a percentage of the gross salary or a specified amount), the Group RRSP members have the option to deposit lump sum into their RRSP plan, within the company’s Group RRSP.
Contribute Directly Without Paying Taxes
In the absence of a Group RRSP, most people’s contributions to an RRSP, come out of their bank account – money has already been taxed. With the help of a Group RRSP however, you allocate a portion of your employee’s pre-tax pay directly into their RRSPs. In effect, employees receive their tax “refund” on every pay cheque.
Spousal Plans Available
Flexibility and Popularity
The decision whether or not to contribute to your employees’ RRSP is completely up to you. If you do contribute, you may opt to match a percentage of their contributions, either on a regular basis or as part of a bonus program. However, any contribution made to an employee’s Group RRSP plan, will be a Taxable Benefit to your employee, thus increasing the payroll taxes. There are other options around this issue, for instance using a DPSP. Please check our other Group Pension Options for more details.