Common use of Designation of a Beneficiary Clause in Contracts

Designation of a Beneficiary. (1) Since January 1, 2004, the Canada Revenue Agency requires that the beneficiary be a Canadian resident when the designation is made. The beneficiary must also be a Canadian resident at the time the subscriber contributes to his RESP. (2) In order to obtain registration of an ESP established by a plan, section 146.1 of the Income Tax Act (Canada) requires, in addition to the social insurance number (SIN) of the designated beneficiary, the SIN of the subscriber and beneficiary's primary caregiver (if this individual and the subscriber are not the same person) or, if applicable, the business number of the ministry, the organization or the establishment acting as public primary caregiver of the beneficiary. The manager’s collecting of this information constitutes a prerequisite for the entry into force of the contract between the subscriber and the Foundation, even if the latter has approved it. (3) For any change of beneficiary, the subscriber must also provide the SIN of the new beneficiary prior to processing this change. (4) The subscriber can make contributions on behalf of the beneficiary whose SIN has not yet been provided to the manager. However, these contributions will be paid into an unregistered (non-interest-bearing) suspense account pending receipt of the missing SIN. (5) When the subscriber provides the missing SIN within twelve (12) months following the application date, the contributions are transferred to the subscriber’s RESP account, according to the plan selected. (6) If the missing SIN is provided within the period of twelve (12) months, the use of the unregistered account offers to the subscriber the advantage that the applicable contribution schedule will be based on the beneficiary’s age at the date of the application, rather that his age at the time the SIN is provided and the RESP registered. (7) When the missing SIN is not provided within the period of twelve (12) months following the application date, the manager will cancel the plan and all contributions made to the unregistered account are refunded to the subscriber, less the sales charges already paid.

Designation of a Beneficiary. (1) Since January 1, 2004, the Canada Revenue Agency requires that the beneficiary be a Canadian resident when the designation is made. The beneficiary must also be a Canadian resident at the time the subscriber contributes to his RESP. (2) In order to obtain registration of an ESP established by a plan, section 146.1 of the Income Tax Act (Canada) requires, in addition to the social insurance number (SIN) of the designated beneficiary, the SIN of the subscriber and beneficiary's primary caregiver (if this individual and the subscriber are not the same person) or, if applicable, the business number of the ministry, the organization or the establishment acting as public primary caregiver of the beneficiary. The manager’s collecting of this information constitutes a prerequisite for the entry into force of the contract between the subscriber and the Foundation, even if the latter has approved it. (3) For any change of beneficiary, the subscriber must also provide the SIN of the new beneficiary prior to processing this change. (4) The subscriber can make contributions on behalf of the a beneficiary whose SIN has not yet been provided to the manager. However, these contributions will be paid into an unregistered (non-interest-bearing) suspense account pending receipt of the missing SIN. (5) When the subscriber provides the missing SIN within twelve (12) months following the application date, the contributions are transferred to the subscriber’s RESP account, according to the plan selected. (6) If the missing SIN is provided within the period of twelve (12) months, the use of the unregistered suspense account offers to the subscriber the advantage that the applicable contribution schedule will be based on the beneficiary’s age at the date of the application, rather that his age at the time the SIN is provided and the RESP registered. (7) When the missing SIN is not provided within the period of twelve (12) months following the application date, the manager will cancel the plan and all contributions made to the unregistered account are refunded to the subscriber, less the sales charges already paid.