Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues: Tax rate on RRSP and RRIF payments made to resident of Ireland.
Position: - Any RRSP or RRIF payment that is a periodic pension payment (PPP) as defined under section 5 of the Income Tax Conventions Interpretation Act (ITCIA) is a pension for the purposes of Article XI of the Canada-Ireland Income Tax Agreement (the "Convention") and is exempt from tax.
- Any RRSP or RRIF payment that is not a PPP as defined in section 5 of the ITCIA (e.g. a lump-sum RRSP or RRIF payment) is not a pension for the purposes Article XI of the Convention; such a lump-sum RRSP or RRIF payment is subject to tax at the rate of 15% under Article VI of the Convention which deals with other income.
Reasons:
962067
XXXXXXXXXX G. Middleton
(613) 957-2122
Attention: XXXXXXXXXX
March 18, 1998
Dear Sir:
This is in reply to your fax of June 6, 1996 concerning the withholding tax rate on payments made under a registered retirement savings plan (“RRSP”) or a registered retirement income fund (“RRIF”) to a resident of Ireland. We apologize for the delay in our reply.
“Periodic pension payment” is defined in section 5 of the Income Tax Conventions Interpretation Act (“ITCIA”) and paragraphs (b) and (c) of the definition deal with payments under an RRSP and RRIF, respectively. If an RRSP or RRIF payment made to a resident of Ireland is a “periodic pension payment” under this definition, such a payment is considered to be a pension for the purposes of Article XI of the Canada-Ireland Income Tax Agreement (the “Convention”) and there is no withholding tax on such a payment.
If an RRSP or RRIF payment (e.g. a lump-sum payment) is not a “periodic pension payment” as defined under section 5 of the ITCIA, such a payment would not be a pension for the purposes of Article XI of the Convention and, accordingly, such a payment would be subject to Canadian non-resident withholding tax at the rate of 15% pursuant to Article VI of the Convention which deals with other income amounts.
We trust the above comments will be of assistance to you.
Yours truly,
for Director
Reorganization and International Division
Income Tax Rulings and Interpretations Directorate
Policy and Legislation Branch
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