Voluntary retirement savings plan (VRSP)

VRSP is a new type of group retirement plans created by the Québec government to help residents of Québec save for retirement. It came into effect on July 1, 2014, and is accessible to self-employed workers, individual investors, business owners and associates. 

What’s a VRSP?

A VRSP is a voluntary retirement savings plan. 

Who can contribute to a VRSP?

  • Employers with an establishment in Québec 
  • Self-employed workers or any other eligible investor
  • Associations, professional bodies or other groups

As an employer, a VRSP will be mandatory if your company:

  • has a certain number of employees who are 18 years of age or older, and have at least one year of uninterrupted service, as defined by the Labour Standards Act; 

and

  • does not already offer a registered retirement savings plan (RRSP) or tax-free savings account (TFSA) for which payroll deductions could be made, or a registered retirement plan. 

The benefits of a VRSP for the employee 

A VRSP is particularly interesting for salaried employees who do not have access to a group retirement savings plan with their employer. Much like the RRSP, contributions to a VRSP are deductible from taxable income, and contributions and investment income grow free of taxes until retirement.

But that’s not all!

  • When contributions are deducted at the source, participants enjoy considerable tax savings. 
  • Contribution rates are solely based on members’ ability to save.
  • Since plan fees are low, savings within a VRSP grow faster.
  • Enrolment is very simple; employees are auto-enrolled by the employer.
  • Contributions remain invested, and participants continue to enjoy the benefits of the plan on cumulated amounts, even after electing to stop contributions.
  • Under unforeseen circumstances, employee contributions are not locked-in. 
  • Amounts accumulated in a VRSP follow the participant, even after employment termination. 

The benefits of a VRSP for the employer

VRSPs are great retirement savings solutions for employees, but they are just as useful to employers; namely because they can help increase your retention rate and therefore reduce turnover costs. By offering this plan to your employees, you take part in their financial future, and demonstrate your interest in their personal prosperity. 

Also…

  • Control over VRSP eligible investments.
  • Support at every step when setting up the plan.
  • Employee contributions, if applicable, are not subject to Quebec payroll taxes, but they are deductible from the company’s taxable revenue.
  • There is no pension adjustment to declare. 
  • Competitive management and administration fees. 
  • The management of a VRSP can easily be integrated to business services in a manner that facilitates payroll deductions and plan contributions.

Are you an employer seeking to offer the VRSP to your employees?

National Bank Trust will work with you, from the implementation of the plan to your members’ disbursement, so that you don’t have to burden yourself with the daily administration of the plan in addition to your ongoing responsibilities. We’re here for you, and we’re committed to supporting your needs at every step of your journey. 

Contact us

To sign up online, visit our VRSP-dedicated website

Or contact us at 1-877-640-7273