ESOP questions

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florch
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ESOP questions

Post by florch »

Our company is looking at a retention plan to try to keep a number of key employees. Several options are on the table including increased company contributions to a DC pension. Some employees may go over the $26k per year of RRSP contribution well before we get to 18%, so there is a limit to what they can do here.

Does anyone here have knowledge or experience with ESOP's? The company is not publicly traded, but is partially owned by a company who is traded outside of Canada. The talk was about a bonus for sticking around for 3 to 5 years. The group of employees is well paid already, so taxes would eat up much of any cash bonus. Could tax be possibly deferred if the bonus was in shares (until you cash out?)

As you may notice, my grip on these concepts is tenuous at best. :D Any help is appreciated!
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Peculiar_Investor
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Re: ESOP questions

Post by Peculiar_Investor »

florch wrote: 31 Jan 2018 00:54 Our company is looking at a retention plan to try to keep a number of key employees. Several options are on the table including increased company contributions to a DC pension. Some employees may go over the $26k per year of RRSP contribution well before we get to 18%, so there is a limit to what they can do here.
To address the contribution limit issue has a Supplementary Executive Retirement Plan (SERP) add-on been discussed? Contrary to the name, this 2015 report from Mercer indicates "Half of SERPS now cover all employees". I'm only aware of SERPs tangentially, as my spouse has been a member of a couple of their working career.

I'm thinking that someone like brucecohen, who seems to know all things pension related, might have further details
Does anyone here have knowledge or experience with ESOP's? The company is not publicly traded, but is partially owned by a company who is traded outside of Canada. The talk was about a bonus for sticking around for 3 to 5 years. The group of employees is well paid already, so taxes would eat up much of any cash bonus. Could tax be possibly deferred if the bonus was in shares (until you cash out?)

As you may notice, my grip on these concepts is tenuous at best. :D Any help is appreciated!
I don't have any specific knowledge, but Google turned up ESOP Association Canada that might be a starting point for learning.
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florch
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Re: ESOP questions

Post by florch »

Thanks for the info. TBH I haven't heard much from work, I was looking for a win win. May happen yet. Busy times, I'll keep digging!
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