2012-2013 BUDGET - Press release no. 11 of 17 - VRSPs, Pension Plans for Two Million Quebecers
QUÉBEC, March 20, 2012 /CNW Telbec/ - "The new voluntary retirement savings plans (VRSP) will henceforth provide two million Quebecers with access to a private pension plan. They will come into force on January 1, 2013," the Minister of Finance, Raymond Bachand, announced today in tabling the Québec government's Budget 2012-2013.
He mentioned that VRSPs will be a flexible and inexpensive solution to encourage Quebecers to save. "Workers will automatically be enrolled in the plan by their employer and a set of default parameters will be offered to them. A worker will be able to change his contribution rate and continue contributing to the same plan if he changes employer. He will be able to dispose of the funds accumulated, withdraw them before retirement and leave the plan at any time. In addition, as with an RRSP, contributions to a VRSP may be deducted from taxable income for Québec and federal tax purposes; the amounts accumulated will not be taxed as long as they are not withdrawn," the Minister pointed out.
VRSPs will be easy for employers to administer. Companies with five employees or more that currently do not offer a pension plan will have to offer a VRSP to their employees by January 1, 2015. They will not be required to contribute to VRSPs, and the plans will be administered by third parties.
"Our objective is to simplify things: easier for the worker, simpler for the employer," the Minister concluded.