There are significant legislative changes coming to the Canadian insurance industry that will have an impact on prescribed annuities. On January 1, 2017, the taxable portion on these annuities will be increasing.
What does this mean for your clients?
This change will not affect prescribed annuities which are purchased before 2017, even if payments are scheduled to begin after January 1, 2017.
However, the following example# illustrates the difference in the taxable portions (under the current (G2) and new (G3) rules) and resulting net payment:
Get ready for 2017!
Learn more about the impact of the new tax rules by contacting your BMO® Insurance Business Development Manager today.
# Male, $100,000 single premium, guarantee period 10 years; quotes based on BMO Insurance rate basis as of Dec. 18, 2014.
† 35% marginal tax rate.
These comparisons are based on the same product features and do not reflect any changes to rates or features between the G2 and G3 scenarios.
MB 409 (2016/04/13)
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