Federal government proposes amendments to Income Tax Act to exempt “top-up” RCAs from Schedule 15 filings
September 15, 2025
On August 13, 2025, the Department of Finance Canada released proposed amendments to the Income Tax Act (“ITA”) which include an exemption from the Schedule 15 filing requirements for retirement compensation arrangement (“RCA”) trusts established for supplemental employee retirement plans (“SERPs”) that “top up” benefits under a registered pension plan, registered retirement savings plan (“RRSP”) or deferred profit sharing plan (“DPSP”).
By way of background, in late 2022, the federal government introduced enhanced trust reporting rules for tax years ending on or after December 31, 2023, which require trusts to file a Schedule 15 as part of its annual T3 tax return to assist Canada Revenue Agency in verifying that trusts, their trustees, beneficiaries, and related parties have met their tax and filing obligations under the ITA. Schedule 15 requires detailed information to be provided for each beneficiary of the trust and other specified parties, which includes personal information such as their name, date of birth, SIN and address. While an exemption from the requirement to file a Schedule 15 is provided to trusts governed by plans such as registered pension plans, DPSPs, RRSPs, employee profit sharing plans, registered retirement income funds, tax-free savings accounts and certain other plans, there is currently no exemption for RCA trusts. As a result, employers who maintain RCAs for the purposes of paying or securing SERP benefits (i.e., pension benefits in excess of benefits provided under a base registered plan) were required to complete onerous Schedule 15 filings disclosing all members with SERP entitlements along with their personal information.
The August 13, 2025 legislative proposals include an amendment to the ITA to add RCAs, whose primary purpose is to provide or secure SERPs, to the list of plans that are exempt from the Schedule 15 filing requirement. The proposed amendment to the ITA will apply to tax years that end after December 30, 2025. Given that the tax year for RCA trusts is the calendar year (ending December 31st), if the proposed amendment to the ITA is enacted, a Schedule 15 will not be required to be filed for the 2025 and future tax years for “top-up” RCA trusts described above.
Click here to view the proposed amendments to the ITA and regulations released on August 13, 2025.
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