Individual Pension Plan (IPP) – Everything You Need to Know

Individual Pension Plan (IPP) – Everything You Need to Know

One of the most important things business owners worry about is planning for retirement. Many business owners opt for an individual pension plan to solve this problem.

The Group Enroll team put together this guide to answer the question, “What is an IPP?” We will explain the structure of pension plans and how they can benefit you as a business owner or executive.

Table of Contents

What Is an Individual Pension Plan?

An Individual Pension Plan (IPP) is a type of retirement fund for business owners and executives. Similar to Registered Retirement Savings Plans (RRSPs), an IPP allows tax-free growth on retirement savings. The main difference between the two is that an IPP is a defined benefit pension plan, meaning you know in advance the exact amount you will have when you retire. 

Similar to RRSPs, you will have to pay tax on withdrawals, but you can deduct IPP contributions from your overall taxable burden. IPP contributions depend on your age, income, salary level, and how long you have worked for the company that provides the IPP.

What Are the Benefits of an IPP?

Canadians can choose between an IPP and RRSP to save for retirement. However, IPPs have several benefits compared to RRSPs.

Higher Contribution Limits

More Varied Investments

Spousal Income Split

Creditor Protection

Tax Deductions

Tax-Free Transferring

IPP Frequently Asked Questions

If you want to know more about “What is an IPP?”, below are some of the most common questions we received.

Who Can Make an IPP?

Can I Make IPP Withdrawals Whenever I Want?

Are IPPs Expensive to Manage?

Who Regulates IPPs?

What Happens to My IPP If I Lose Employment?


Compare Pension Plans Today!

Now that we’ve answered the question “what is an IPP?”, you’re ready to take the next step. Group benefits give employers the ability to provide benefits to employees, including group retirement savings plans like IPPs.

Fill out our quote form to receive competitive quotes from Canada’s top group benefits providers. You can also email our team at or visit our office at 10 Great Gulf Drive, Unit 5, Vaughan, ON, L4K 5W1.