Modernizing qualified investment rules for tax-advantaged savings plans

Submission – Finance – Consultation on Qualified Investments for Registered Plans

Recipients

• Department of Finance Canada

Industry segments this resource supports

• Assets management
• Wealth management

Summary

We responded to the federal government’s consultation on modernizing qualified investment (QI) rules for tax-advantaged savings plans such as RRSPs, RRIFs, RESPs, RDSPs, and TFSAs. The submission provides recommendations to consolidate and update QI rules, introduce new categories of qualified investments, maintain eligibility for crypto fund units, and avoid reintroducing foreign property rules. It also addresses how the QI regime can better balance investment security, diversification, and administrative clarity.

Why this matters: This submission matters because it outlines industry recommendations that could modernize qualified investment rules and improve clarity, investor protection, and investment choice within registered savings plans.

Key takeaways

• IFIC supports modernizing QI rules to improve clarity, coherence, and consistency across registered plans.
• The submission answers three consultation questions:
  • Whether conditions for pooled investment products to qualify as QIs remain appropriate.
  • Whether QI rules should promote more Canadian-based investments.
  • Whether crypto-backed assets are appropriate as QIs.
• IFIC recommends consolidating QI rules into one section of the Income Tax Act and adding two new categories of investment funds regulated under Canadian securities laws as QIs.
• IFIC recommends that units of mutual fund trusts or listed investment funds providing cryptocurrency exposure should continue to qualify as QIs, even though cryptocurrency itself is not a QI.
• IFIC strongly advises against reintroducing foreign property rules, noting that such restrictions previously limited diversification and negatively affected investor outcomes.
• The submission highlights the need for a more intuitive, streamlined registered investment regime and suggests replacing the current CRA registration process with a self-assessment model.

IFIC emphasizes that regulated crypto funds offer greater investor protection than holding cryptocurrency directly due to custody, valuation, and regulatory safeguards.