Providing a detailed description of a Client’s occupation is an anti-money-laundering/anti-terrorist financing (AML/ATF) requirement for all universal life and permanent life insurance products, as well as for non-registered wealth and investment products.
We need to collect Clients’ detailed occupations as part of the record keeping requirements for Client information records to comply with Canada’s AML/ATF legislation. This detailed information helps us determine if a transaction or activity is consistent with what we’d expect for a given Client.
Here are some examples of vague and detailed descriptions:
Vague |
Detailed |
|
Business owner, Retired business owner |
Owner of hair salon, Home appraiser, Landscaper, Retired Dentist |
|
Retired |
Retired police officer, Retired tax consultant |
|
Self employed |
Landscaper, House painter, Dog walker, Hair dresser |
|
Administrator, Administration |
School board administrator, Hospital administrator, Charity administrator |
|
Federal, Provincial or Municipal government |
Budget analyst, Court clerk, Maintenance worker, Payroll or Billing clerk |
|
Farmer |
Tobacco Farmer, Poultry Farmer, Beef Farmer, Cannabis Farmer |
|
Manufacturer |
Furniture Manufacturer |
|
Consulting |
Technology Consulting |
Specific requirements for Entity Owner applications – Corporation, Partnership, Trust, Estate
When recording occupations for Individuals involved with the Entity, the occupation needs to be the Individuals principal occupation.
Foreign account tax account legislation (FATCA) also requires you to identify whether a holding company is active or passive. If you’re working with a corporation that is a holding company, you must also provide their active or passive holdings. The definitions for active and passive holding companies are below.
Holding company-active:
If more than 50% of a holding company’s income is from businesses actively involved in providing goods or services, it is active.
Example: A holding company that has 40% of its income come from an active landscaping business, 40% from an active snowplowing business and 20% from investments is considered active. When providing the business description, you would state: Holding company- active landscape/snowplowing.
Holding company-passive:
If more than 50% of a holding company’s income is from passive income, it is passive.
Example: A holding company that has under 50% of its income come from actively collecting rent from rental properties and earns the rest from passive investments is considered passive. When providing the business description, you would state: Holding company-passive investments.
Contacts:
*An insurance GIC is an accumulation annuity issued by Sun Life Assurance Company of Canada