A DPSP is a registered plan that allows companies to share their profits with employees. DPSPs provide tax incentives and allow for vesting periods on employer contributions but do not allow employees to contribute to the plan. A Deferred Profit Sharing Plan, combined with a Group Retirement Savings Plan can be a cost-effective alternative to a Defined Contribution Pension Plan.
This plan may be an appropriate choice if:
A Capital Accumulation Plan (CAP) is a tax assisted investment or savings plan that permits the members of the CAP to make investment decisions in accordance with options offered within the plan. A Group Savings plan is considered a CAP. The Joint Forum of Financial Market Regulators issued the CAP guidelines to clearly outline the responsibilities of parties involved in a CAP and to ensure that members participating in a CAP were receiving the information and assistance they needed to make investment decisions.
RBC Royal Bank will work with you to ensure that your plan complies with the CAP guidelines.See complete CAP Guidelines