Income Tax Regulations — 8509
8509 (1) The prescribed conditions for the registration of a grandfathered plan are, before 1992, (a) the condition set out in paragraph 8502(a), (b) the condition set out in paragraph 8502(c), but only in respect of benefits provided under a money purchase provision of the plan, and (c) if the plan contains a money purchase provision, the condition set out in paragraph 8506(2)(a), and the following conditions: (d) the benefits provided under each defined benefit provision of the plan are acceptable to the Minister and, for the purposes of this condition, any benefits in respect of periods before 1991 that become provided after 1988 with respect to a member who is connected with an employer who participates in the plan, or was so connected at any time before the benefits become provided, shall, unless the Minister is notified in writing that the benefits are provided with respect to the member, be deemed to be unacceptable to the Minister, and (e) the plan contains such terms as may be required by the Minister. Conditions Applicable after 1991 to Benefits under Grandfathered Plan (2) For the purpose of the condition in paragraph 8502(c) as it applies after 1991 in respect of a grandfathered plan, (a) the condition in subparagraph 8503(2)(b)(ii) is replaced by the condition that the amount of bridging benefits payable to a member for a particular month does not exceed the amount that is determined in respect of the month by the formula (A × C × (E / F)) + (G × (1 - (E / F))) where A is the amount determined for A under subparagraph 8503(2)(b)(ii) with respect to the member for the month, C is the amount determined for C under subparagraph 8503(2)(b)(ii) with respect to the member for the month, E is the aggregate of all amounts each of which is the duration (measured in years, including any fraction of a year) of a period ending before 1992 that is pensionable service of the member under the provision, F is the aggregate of all amounts each of which is the duration (measured in years, including any fraction of a year) of a period that is pensionable service of the member under the provision, and G is the amount determined with respect to the member for the month by the formula set out in subparagraph 8503(2)(b)(ii); (b) the conditions in paragraphs 8503(3)(c), (h) and (i) and 8504(1)(a) and (b) apply only in respect of lifetime retirement benefits provided in respect of periods after 1991; and (c) for the purposes of the conditions in paragraphs 8504(1)(a) and (b), (i) the aggregate that is determined under subparagraph 8504(1)(a)(i) does not include an amount in respect of 1991, and (ii) the amount that is determined for G under subparagraph 8504(1)(a)(ii) is based only on periods of pensionable service after 1991. Additional Prescribed Condition for Grandfathered Plan after 1991 (3) The prescribed conditions for the registration of a grandfathered plan include, after 1991, the condition that all benefits provided under each defined benefit provision of the plan in respect of periods before 1992 are acceptable to the Minister. Defined Benefits under Grandfathered Plan Exempt from Conditions (4) The Minister may, after 1991, exempt from the condition in paragraph 8502(c) the following benefits provided under a defined benefit provision of a grandfathered plan: (a) benefits that are payable after the death of a member, to the extent that the benefits can reasonably be considered to relate to lifetime retirement benefits provided to the member in respect of periods before 1992; and (b) bridging benefits in excess of bridging benefits that are permissible under paragraph 8503(2)(b), to the extent that the excess bridging benefits are vested in a member on December 31, 1991. Benefits under Grandfathered Plan — Pre-1992 Disability (4.1) Where benefits are provided under a defined benefit provision of a grandfathered plan to a member of the plan as a consequence of the member having become, before 1992, physically or mentally impaire