RCA Cash Flows
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RCA Cash Flows. $2 Income (2). RCA Investment Account (held in trust by Custodian). $2 Benefit (3). $1 Cont. (1). $1 Income (2). Employee. $2 Contribution (1). $1 Cont. (1). $1 Refund (3). RCA Refundable Tax Account (held at CRA). Employer. RCA Cash Flows (Legend).

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Employer

RCA Cash Flows

$2 Income(2)

RCA Investment Account

(held in trust by Custodian)

$2Benefit(3)

$1 Cont.(1)

$1 Income(2)

Employee

$2 Contribution(1)

$1 Cont.(1)

$1 Refund(3)

RCA Refundable

Tax Account

(held at CRA)

Employer


Rca cash flows legend

RCA Cash Flows (Legend)

(1)When the Employer makes a $2 contribution to the RCA, they would deposit $1 (i.e. 50%) to the RCA Investment Account. They would remit $1 (i.e. the 50% refundable tax) to the RCA Refundable Tax Account held at CRA.

(2)When the RCA Investment Account earns $2 of income (interest & dividends and realized capital gains net of realized capital losses) in a calendar year, the RCA Trust would remit the 50% refundable tax on realized investment income (e.g. $1) to the RCA Refundable Tax Account held at CRA upon the filing of the T3-RCA trust return for the calendar year.

(3)When the RCA Trust pays $2 of benefits to the Employee on a taxable basis from the RCA Investment Account in a calendar year, CRA would issue a refund of $1 (i.e. the 50% refundable tax) from the RCA Refundable Tax Account to the RCA Trust after their assessment of the T3-RCA trust return for the calendar year.


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