What is Retirement Compensation Arrangements?

Retirement compensation arrangements are defined under subsection 248 of the Canadian Income Tax Act, which allows 100 per cent tax-deductible corporate dollars to be deposited into an RCA, on behalf of the private business owner and/or key employee.

Who should consider Retirement Compensation Arrangements?

If you are 10 -15 years from retirement, need life insurance, have ready disposable income or maxing out on your annual RRSP contributions, you should consider RCA.

Benefits of Retirement Compensation Arrangements

RCA payments can be paid as a lump-sum or supplementary retirement benefit. The advantages are:

  • Contributions are tax deductible for the company
  • Contributions are not taxable to the employee until the benefits are received
  • Taxes paid by the employee are generally lower

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          945+ Reviews

          Client Logo
          Maria Marlin Retired Govt Officer, ON, Canada

          Very helpful fully explaining the different plans. Cash value is accessed via policy loans, which accrue interest and reduce cash value our valuable items.

          Client Logo
          Maria Marlin Retired Govt Officer, ON, Canada

          Very helpful fully explaining the different plans. Cash value is accessed via policy loans, which accrue interest and reduce cash value our valuable items.