Retirement compensation arrangements RCAs are, in appropriate circumstances, a useful tool for employers to provide supplemental pension benefits to employees, but such arrangements come at a cost of refundable tax under the Income Tax Act Canada the ITA. The 2023 Federal Budget the Budget, released on March 29, 2023 Budget Day, proposes to amend the ITA to exempt, from the refundable tax, fees or premiums to the extent paid for the purposes of securing or renewing a letter of credit or a surety bond for an RCA structured as supplemental to a registered pension plan.