A new year often comes with new resolutions—and maybe one of those goals is planning for retirement this year. If you are thinking about retiring in the next year few years, here are the answers to some frequently asked questions CPA Alberta receives on the subject.
1. As a retired CPA, do I still have to pay CPA Alberta membership fees?
Retiring does not automatically mean membership fees cease; rather, like all Alberta CPAs, those that are retired may qualify for a reduction in annual fees based on active earnings. You are considered to be eligible for a reduction in annual fees if you do not anticipate being gainfully employed for the calendar year, such that active earnings from all types of employment or business will not exceed $30,000.
“Active earnings” include all earnings from employment, business, professional corporations and director’s fees. Active earnings include both accounting and non-accounting related income, but exclude employment insurance (EI) benefits, long-term disability benefits, investment and pension income.
Fee reductions apply in the following circumstances:
|75%||Partial||A member who is not gainfully employed, such that Active Earnings from all types of employment or business does not exceed $30,000. Reduced active earnings may be a result of, but not limited to, parental leave, leave to care for a family member, medical leave, or long-term disability.|
|100%||Full||A member who is permanently withdrawn from gainful employment, such that active earnings from all types of employment or business are nil. Permanent withdrawal from gainful employment may be a result of, but not limited to, medical leave, long term disability or full-time retirement.|
The Membership Fee Reduction Request Form must be submitted in order to apply for a fee reduction.
2. How does being retired affect my CPD requirements and CPD declaration?
As Alberta CPAs reach retirement, they may be uncertain as to what they need to do in order to maintain their CPA designation and membership.
It’s important to note that while every Alberta CPA must make a CPD declaration each year, not everyone must participate in CPD learning activities. The requirement to continue to take CPD activities, even when retired, is solely dependent upon what you are doing during your retirement years.
Being retired from the workforce may or may not affect your CPD requirement. In order to determine if you would have a requirement to participate in CPD learning activities consider the following:
- Did you work in any capacity during the calendar year?
- Was there any third party reliance on your competencies as a CPA?
If you answer no to both of these questions, you would qualify for the “permanently withdrawn from the workforce” exemption.
If you answered yes to one or both of these questions, you may still have a CPD requirement for the year.
For example, as a CPA reaches retirement, they might choose to participate in volunteer activities where they use the skills, knowledge and expertise that they gained as a CPA. In some of these volunteer roles, the other members serving on the committee, or the public may look to these CPAs for management guidance, financial oversight or expertise, business acumen and the like. In other words, these people continue to rely on the CPA, even though they may be retired and serving in a volunteer capacity. In that case, the CPA would be required to continue to meet the profession’s CPD requirements.
If you have questions about retirement, the advisory services team can help. Contact Larry Brownoff CPA, CA at firstname.lastname@example.org or 1-800-232-9406.
Upcoming retirement seminars
Whether you are planning for retirement, or helping clients plan for theirs, here are some PD seminars that may interest you.
- Retirement Planning for Financial Professionals – On Demand
- Securing your Organization’s Future: Managing the Revolving Door of Succession Planning and Employee Retention – On Demand
- What’s Next: 10 Success Factors to Best Manage Retirement – March 2 in Edmonton and March 4 in Calgary
- Beyond the Numbers: A Closer Look at Retirement Options – March 3 in Edmonton and March 5 in Calgary
- Cash Cows, Pigs and Jackpots: The Simplest Personal Finance Strategy Ever – March 6, Live Webinar
- Advanced Tax Planning Strategies for Business Succession – March 11 in Calgary
- Smoke and Mirrors: Financial Myths That Will Ruin Your Retirement Dreams – March 13, Live Webinar
- Enough Bull: How to Retire Well Without the Stock Market, Mutual Funds or Even an Investment Advisor – March 17 in Calgary and March 18 in Edmonton
- The Procrastinator’s Guide to Retirement: How You Can Retire in 10 Years or Less – March 20, Live Webinar
For a full list of PD seminars, visit the new PD portal.