Plan types · Deferred Profit Sharing Plan

DPSP administration, built to pair with your Group RRSP

A Deferred Profit Sharing Plan (DPSP) holds employer contributions only. Most employers pair it with a Group RRSP: employees save in the RRSP, and the employer match goes to the DPSP, where it avoids CPP and EI premiums and can vest over time. LINK administers and keeps the records for both plans together.

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How it works on LINK

What LINK handles, and what stays with you

LINK handles

  • Recordkeeping for each member's DPSP account alongside their Group RRSP
  • Employer contributions calculated automatically from your matching formula
  • Vesting tracked to the schedule you set, including forfeitures when an unvested member leaves
  • Investments managed in the same suitable ETF portfolio as the member's other plan accounts
  • Member access to balances and vesting status in one place

Your organization

  • Choose the matching formula and vesting schedule
  • Fund employer contributions through payroll
  • Report pension adjustments on employees' T4 slips
At a glance

DPSP essentials

Who contributes
The employer only; employees cannot contribute to a DPSP
Payroll costs
Employer contributions are not subject to CPP and EI premiums
Vesting
Immediate, or up to a maximum of two years
Access to savings
Not locked in by pension legislation
2026 limit
$17,695 in employer contributions per member
Effect on RRSP room
Employer contributions create a pension adjustment that reduces the member's RRSP room the following year
What it costs
Set plan by plan, and can vary based on plan size, the investments offered, and whether an advisor is involved. See our fee transparency guide for what goes into it.

General information only. Rules and limits can change each year; confirm details with your plan specialist.

Questions

DPSP questions, answered

What is a DPSP used for?

A DPSP holds employer contributions, usually the employer match on a Group RRSP. It is used because those contributions avoid CPP and EI premiums and because the employer can set a vesting period of up to two years.

Can employees contribute to a DPSP?

No. Only the employer contributes to a DPSP. Employees make their own contributions to a paired plan such as a Group RRSP or Group TFSA.

What happens to unvested DPSP money when an employee leaves?

Unvested employer contributions are forfeited under the plan's terms, and the member receives a pension adjustment reversal that restores the related RRSP room.

Is a DPSP offered on its own?

DPSPs are most often paired with a Group RRSP, so employees have a plan for their own contributions. LINK administers both together, and a plan specialist can confirm the right structure for your workforce.

Go deeper

Related guides

Employer guide
How Employer Matching Works: Formulas, Rules, and Best Practices →
Employer guide
Group RRSP vs. DC Pension Plan: Which Should You Offer? →
Employer guide
Pension Adjustments (PA) and How They Affect RRSP Room →
Employer guide
A Guide to Group RRSPs for Canadian Employers →
Other plan types on LINK
Group RRSPDC pension planLINK MEPPGroup TFSANRSP

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