The Government of Saskatchewan and the federal government have released draft legislative amendments to accommodate changes to the Saskatchewan Pension Plan outlined in the province’s 2010 budget.
The Saskatchewan Pension Plan is a voluntary defined contribution pension plan established by the provincial government that helps small businesses that do not offer pension plans, provides economical professional investment management of retirement savings and gives employees full portability of pension savings between employers.
"Saving for retirement is an important objective for Canadian families," said Jim Flaherty, Canada's minister of finance. "We are continuing to move forward to provide greater flexibility and opportunity to achieve this goal. Saskatchewan's proposed changes to the Saskatchewan Pension Plan are consistent with these objectives and with these proposals. We are able to accommodate these changes under the Income Tax Act."
The amendments include an increase in the annual contribution limit to $2,500 from $600 and tax treatment in alignment with other tax-assisted retirement savings vehicles. These changes will ensure members benefit from additional features of the registered retirement savings plan and registered pension plan rules that were not previously available to them, said the government. The proposed changes will apply to 2010 and subsequent taxation years.
"We are very pleased that the federal government has agreed to our request to increase the contribution limit," said Ken Krawetz, Saskatchewan's deputy premier and finance minister. "Plan participants requested this change and we are responding."
The Government of Saskatchewan is also proceeding with amendments to provincial legislation and regulations required to enact these changes.
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