For incorporated professionals over 40 earning T4 income of $150,000+, an Individual Pension Plan (IPP) allows significantly larger tax-deductible contributions than an RRSP — often 2-3x more. The IPP is a defined benefit pension plan with one member (you), registered with CRA, and funded by your corporation. It provides guaranteed retirement income, creditor protection, and tax-deductible contributions that grow with age.
| Feature | RRSP | IPP |
|---|---|---|
| 2026 contribution limit (age 50) | $32,490 | ~$55,000-$65,000 |
| 2026 contribution limit (age 55) | $32,490 | ~$70,000-$85,000 |
| 2026 contribution limit (age 60) | $32,490 | ~$90,000-$110,000 |
| Past service buyback | No | Yes — can fund past years |
| Creditor protection | Limited | Full protection under pension legislation |
| Terminal funding at wind-up | No | Yes — additional tax-deductible contribution |
| Investment management fees | Personal expense | Corporate tax-deductible |
Setting up an IPP requires an actuary to design the plan, registration with CRA, and ongoing actuarial valuations every three years. SG Wealth Management coordinates the entire process and manages the IPP investments alongside your other retirement assets to ensure optimal retirement income planning.
An IPP is one component of a comprehensive retirement strategy that may also include RRSP optimization, corporate surplus investment, and corporate-owned life insurance. Contact us to determine if an IPP is right for your situation.