Why Doctors and Dentists Need the
Family Pension Plan (FPP)
Why would a medical professional opt for the FPP instead of an RRSP?
Your professional corporation gets to pay for your pension with pre-tax income. This means that you get to reduce your corporate tax payable while increasing your pension assets at the same time. While the maximum contribution to an RRSP in 2020 is $27,230, under an FPP it could range from $29,126 to over $45,711. This could result in much higher tax deductible contributions for your corporation, helping to preserve your small business rate.
All of the administrative burden of running a personal pension program are offloaded to a professional corporate administrator whose sole task is to ensure 100% compliance on your behalf. This eliminates the liability and burden of requiring individual trustees. Professionals can then focus on what they do best.
Pension law allows for income-splitting as early as age 55.
Pension laws protect your hard-earned assets from the claims of trade creditors, something that few RRSPs offer.
At ITI Financial, we pride ourselves on total transparency: there are no deferred sales charges and you know how much you are paying for the services you are getting.