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B.C. physicians: Are you leaving retirement savings on the table?

Man hiking standing at the top of a mountain overlooking the scenery, of mountains and water.

Did you know that you could get money to boost your retirement savings — just for working as a physician in B.C.?

If you’re a British Columbia doctor, you may be eligible for a reimbursement for your retirement savings through the Contributory Professional Retirement Savings Plan (CPRSP).

Here are 6 things you need to know.

1. Who’s eligible for the CPRSP

If you’re paid under the fee-for-service model — as are most physicians in B.C. — you may qualify for the CPRSP, which is a benefit negotiated between Doctors of BC, the Medical Service Commission and the Government of British Columbia.

You may also qualify if you are paid sessional or service contract income by one of the six health authorities in the province. 

2. Basic CPRSP benefit + length of service

The benefit has two components: a basic benefit available to all eligible physicians based on eligible income; and a length of service (LOS) benefit based on how long you’ve been practising in B.C. — the minimum being nine months of work earning eligible income while covered by the Canadian Medical Protective Association.

3. Determine the best strategy

You can make a contribution to an investment account (RRSP, spousal RRSP, TFSA or IPP) that is equal to or greater than your CPRSP entitlement. You will need to choose which one (or which combination) is best for you and carefully consider the tax implications.

Your MD Advisor* can make sure you’re on the right track so you can maximize your returns and minimize your taxes.

4. CPRSP is a taxable benefit

Because it is a taxable benefit, your CPRSP amount will be included in your personal income.

RRSP: If you contribute to your RRSP, the taxable CPRSP income will be offset by the RRSP deduction, and you would not see an increase in overall personal taxes.

TFSA: If you contribute to your TFSA, you won’t get a deduction so there will be an increase in your personal taxes. Talk to your MD Advisor about how to optimize the CPRSP benefit based on your situation.

5. The application process

Doctors of BC will send you an email notification once the CPRSP is available to claim, confirming your entitlement amount. You will make your contribution, using your own funds first. Then submit your application online through the Doctors of BC website. Proof of deposit is no longer required, but you may be selected to provide proof at a later date. Once your submission has been received, your CPRSP benefit will be deposited into your bank account.

6. Don’t miss claiming your benefits

If you don’t apply for the CPRSP, your basic benefit will expire in three years. For example, the CPRSP benefit for 2021 expires on March 31, 2024.

If you’ve missed any of the three previous years’ benefits (2018, 2019, 2020), your entitlement details are available on the Doctors of BC website.  All claims will need to be submitted online.

To learn more

MD Financial Management’s close relationship with Doctors of BC means your MD Advisor can work with you to understand, apply for and optimize your CPRSP benefit. We’ll help you navigate today’s challenges and save for tomorrow with the right advice.

If you’d like to deposit your contribution in an MD RRSP, TFSA or corporate IPP, contact an MD Advisor today.

Other information is available on the Doctors of BC website, by emailing benefits@doctorsofbc.ca or by calling Doctors of BC at 604 638-2926.

* MD Advisor refers to an MD Management Limited Financial Consultant or Investment Advisor (in Quebec), or an MD Private Investment Counsel Portfolio Manager.

The above information should not be construed as offering specific financial, investment, foreign or domestic taxation, legal, accounting or similar professional advice nor is it intended to replace the advice of independent tax, accounting or legal professionals.