October 2018 Edition

On September 20, MFS announced the appointment of Edward M. "Ted" Maloney as Chief Investment Officer, effective January 1, 2019. Reporting to Michael Roberge, Chief Executive Officer, he will be responsible for the ongoing development and success of the global investment platform. Mr. Maloney joined MFS in 2005 as an Equity Research Analyst and was appointed Director of US Equity Research in 2011. Subsequently, he became co-manager of the diversified portfolios. In 2016, he was appointed Director of Global Research.

We are pleased to announce the two winners of our "$500 just like magic (well, almost)" contest; it ran from July 1 to September 28, 2018.

Congratulations to our winners!

• Dean Howard of Burlington, Ontario
• Mathew Buzzetti of Dollard-des-Ormeaux, Quebec
• Nico Lebrun of Havre-Saint-Pierre, Quebec
• Alex Gendron of Verdun, Quebec
• Julie Bergeron of Ste-Ursule, Quebec
• Marie-France Archambault of Laval, Quebec

The winners have received their prize in the form of a gift card or bonus to their group retirement savings plan.

All members with a valid email address at 11:59 p.m. on the night before the draws were eligible and automatically entered.

As we announced in August, participants in a registered pension plan (RPP)1, VRSP2, RRSP or DPSP who will be turning 71 before the end of 2018 were sent a benefits statement in September encouraging them to convert their accumulation plan into a retirement income vehicle, such as a registered retirement income fund (RRIF), a life income fund (LIF) or an annuity.

Certain participants have not yet contacted us to let us know how they wish to proceed with their retirement savings. Please note that these participants must convert their plan by December 31, 2018, at the latest.

If Desjardins Insurance does not receive any instructions from these participants, we will need to transfer any non locked-in amounts to a RRIF, and any locked-in amounts to a LIF. If the participant’s balance is less than 20% of the maximum pensionable earnings (MPE), which is $11,180 in 2018, the amount will be reimbursed in a lump-sum payment and will therefore taxable for the 2018 fiscal year.

Please advise all concerned participants.

Participants can call our Customer Contact Centre at 1-800-968-3587 This link will launch your default phone software. if they require assistance.

It is very important to remind your plan members to complete their plan enrolment as quickly as possible, if they have not already done so. If they fail to complete their enrolment, the following consequences may occur:

• An employee’s RRSP or TFSA for which enrolment is missing will not be registered with government authorities. Contributions will be invested in a temporary fund that pays no interest, and in the case of the RRSP, no tax receipt will be issued for 2018.

In compliance with CRA guidelines, we cannot retain sums deposited to the RRSP, NRSP or TFSA plans for a plan member unless they have completed the enrolment process on-line or by filling in and signing the paper enrolment form. In order to avoid having to return these amounts to you, the enrolment process must be completed as soon as possible.

If you have any plan member in this situation, you will receive an email from your administrator with the list of members and deadline.

• In the case of a VRSP, as enrolment is automatic, these consequences do not apply.
• In the case of a non-registered plan, the requirements related to anti-tax evasion will not be respected and no tax slips will be issued.

In all these cases, including SPPs, DCPPs and DPSPs, the investment instructions, beneficiary designation and consent for the collection, management and use of personal information are also missing.

Your collaboration is therefore essential to help your plan members avoid unpleasant situations.

Consult our Missing Information Report

The Missing Information Report3 lists any information we do not have on file. It's available every month, if needed, on the Plan Sponsor Services website at dfs.ca/plansponsor External link. Opens in a new window..

To review it, go to the Report Center tile and then open the Missing Information Report tab. You can update missing information in a participant’s file by clicking on the Participant management tile, or you can send us a demographic file with all the missing information.

If you set up a deferred profit-sharing plan (DPSP) prior to March 2018,4] your plan text includes a clause about contribution frequency (section 4, item 4.4). However, you’re not necessarily required to make periodic contributions.

The reason is simple. You need to earn profits before you can contribute to your DPSP. If you don’t have any profits from previous years, you’ll need to wait until you have confirmation that your company will report a profit for the current year. Otherwise, there may be tax consequences.

A reminder regarding your contributions

Vous pouvez cotiser jusqu’au moins élevé des montants suivants :

• 18% of a plan member’s salary for the calendar year
• 50% of the contribution limit for registered pension plans under the Income Tax Act (the limit for 2018 is $13,250; visit the CRA’s website External link. Opens in a new window. for information on past and current pension limits)

You also need to report pension adjustments to the Canada Revenue Agency. A pension adjustment reduces your employees’ RRSP contribution room.

DPSP information for your employees

Here’s a document (PDF, 539 KB) Opens in a new window. that may be helpful for your employees.