Scotia BRIDGE Frequently Asked Questions
What is ScotiaBRIDGE?
ScotiaBRIDGE is an Approved Retirement Scheme (ARS), a vehicle for accumulating funds for retirement. This plan enables individuals to make tax-deductible contributions during their working years, and those contributions are invested in trust until retirement.
What tax benefits do ScotiaBRIDGE offer?
Contributions of up to 20% of your annual income are tax-deductible, and all the earnings on your investment during accumulation are tax-free.
Explain the term tax-deductible?
Contributions made to ScotiaBRIDGE are deductible from your gross income to arrive at your taxable income to which the tax rate will be applied. A lower taxable income will result in a lower amount of tax payable to the government.
If I am a member of an existing Super-Annuation plan, can I purchase a ScotiaBRIDGE?
No Current pension legislation allows for participation in only one approved Pension Plan or Scheme. So only persons who are presently not members of any approved Pension Plan or Scheme can purchase a ScotiaBRIDGE and reap the benefits.
Can I purchase a ScotiaBRIDGE plan for my family member who is my dependent?
No. you cannot purchase a plan for them, as contributions are based on the annual income of the member. However, this dependent can be named as a beneficiary on your plan.
What happens if I die before retirement?
Your plan value is paid out to your beneficiary, tax-free.
Can I withdraw cash from my ScotiaBRIDGE plan before retirement?
Similar to a Superannuation Fund, you are unable to withdraw from your plan before retirement; however you can transfer from one ARS to another ARS or to a Superannuation Fund.
What happens when I retire?
Upon retirement you can take up to 25% of the plan value as a tax-free lump sum cash payment, and the balance must be used to purchase a Payout Annuity or another approved income plan.
What is an Annuity?
An annuity in simple terms can be defined as a series of payments for a specified period of time.