Deferred Profit Sharing Plan - DPSP

What is a 'Deferred Profit Sharing Plan - DPSP'

A deferred profit sharing plan (DPSP) is an employer-sponsored Canadian profit sharing plan that is registered with the Canadian Revenue Agency. On a periodic basis, the employer shares the profits made from the business with all employees or a designated group of employees. Employees receiving a share of the profits paid out by the employer do not have to pay federal taxes on the money received from the DPSP until it is withdrawn.

BREAKING DOWN 'Deferred Profit Sharing Plan - DPSP'

An employer that chooses to participate in a DPSP with some or all of its employees is referred to as the sponsor of the plan. Employees who are granted a share of the profits are the trustees of the plan. DPSPs are a type of pension.

RELATED TERMS
  1. Profit-Sharing Plan

    A plan that gives employees a share in the profits of the company. ...
  2. Employer-Sponsored Plan

    A type of benefit plan that an employer offers for the benefit ...
  3. Corporate Pension Plan

    A formal arrangement between a company and its employees - or ...
  4. Registered Pension Plan - RPP

    A form of a trust that provides pension benefits for an employee ...
  5. Employee Contribution Plan

    A company-sponsored retirement plan where employees may elect ...
  6. Special Employer

    An employer who receives an employee on loan from another business, ...
Related Articles
  1. Personal Finance

    Life Insurance Plans to Help Your Small Business Retain Employees

    How to use and design cash value life insurance plans as an incentive to help attract and retain key employees.
  2. Taxes

    401(k) And Qualified Plans: Introduction

    By Denise ApplebyDuring retirement years, income for retirees usually comes from three primary sources: Social Security benefits The regular savings account of the retiree Retirement-plan ...
  3. Professionals

    Split-Dollar Life Insurance

    Split-Dollar Life Insurance
  4. Professionals

    Types and Provisions of Qualified Plans

    Types and Provisions of Qualified Plans
  5. Professionals

    Fringe Benefits

    CFP Online Study Guide - Employee Benefits Planning - Fringe Benefits
  6. Professionals

    Other Employee Benefits

    Other Employee Benefits
  7. Professionals

    Other Qualified Retirement Plans

    FINRA/NASAA Series 26 Section 4 - Other Qualified Retirement Plans. In this section simplified employee pension (SEP) IRAs, savings incentive match plans for employees (SIMPLE), 457 governmental ...
  8. Professionals

    Cafeteria Plans

    CFP Study Guide - Other Employee Benefits - Section 125 (Cafeteria) Plans
  9. Professionals

    Qualified Employer-Sponsored Retirement Plans

    Qualified Employer-Sponsored Retirement Plans. In this section Defined Benefit vs. Defined Contribution Plan and 401(k), 403(b) and Profit-Sharing plans.
  10. Taxes

    401(k) And Qualified Plans: Types Of Plans

    By Denise ApplebyDefined-Benefit PlansUnder a defined-benefit plan, employees' retirement benefits are predetermined by their compensation, years of service and age. For example, the plan ...
RELATED FAQS
  1. What is the best retirement plan option for a physician with her own practice, employees ...

    It is very unlikely that you will find a qualified plan or an IRA-based plan that will allow the employer to exclude other ... Read Answer >>
  2. How do I "vest" something?

    Vesting is a term usually related to pension plans that some employer's provide to their employees.An employer may make contributions ... Read Answer >>
  3. How can an entrepreneur save for retirement?

    Learn about the retirement savings plan options for entrepreneurs and small business owners, including administration and ... Read Answer >>
  4. What are qualified retirement plan types?

    Understand the different types of qualified retirement plans and what they mean in terms of employee and employer contribution ... Read Answer >>
  5. Can LLCs have employees?

    Discover how limited liability corporations (LLC) can have an unlimited number of employees and the legal steps required ... Read Answer >>
  6. What are some examples of common fringe benefits?

    Learn how offering fringe benefits can be a strategic recruitment and retention tool for employers and drastically increase ... Read Answer >>
Hot Definitions
  1. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  2. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  3. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  4. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  5. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  6. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
Trading Center