| Q. |
What is the difference between an Annual Interest Bond and a Compound Interest Bond?
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| A. |
Annual Interest bond:
Interest is paid once a year on June 21 up to and including the Maturity Date for the OSBs, or such
earlier date on which the bond is redeemed, at the rate set for the relevant period. Interest is paid
by cheque, mailed to the address of the bondholder(s), or by direct deposit to the account of the
bondholder(s). Accrued interest payable on any semi-annual redemption (i.e. December 21) is calculated
and paid by the Redemption Agent where the Annual Interest bond is presented at the time of redemption.
Compound Interest bond:
Interest is compounded annually, on June 21, 2009, and every June 21 thereafter up to and including
the Maturity Date, at the rate set for the OSB for each relevant period. Interest on Compound
Interest Bonds accumulates, and is paid to the bondholder(s) when the bond is redeemed, exchanged
for an Annual Interest bond of the same type, or on the Maturity Date of the bond.
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| |
| Q. |
When do I receive the interest on my Ontario Savings Bonds?
|
| A. |
For Annual Interest bonds, interest is paid on June 21, 2009, and every June 21 thereafter up to and
including the Maturity Date.
For Compound Interest bonds, interest is compounded on June 21, 2009 and every June 21 thereafter
and is paid to the bondholder(s) at maturity or when the bond is redeemed.
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| |
| Q. |
How can I tell if my Ontario Savings Bond is a Compound Interest bond or an Annual Interest bond?
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| A. |
"Annual Interest Bond" or "Compound Interest Bond" is indicated in the top portion of the Ontario Savings
Bonds certificate. It is also indicated on the purchaser's copy of the Purchase Application Form (ONT1).
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| Q. |
How is interest calculated on the Variable-Rate Bond?
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| A. |
The interest rate on the Variable-Rate Bond is an annual interest rate that is reset semi-annually.
Interest is calculated based on two equal semi-annual payments.
For example, the interest earned on a December 21 Redemption Date is half of the interest that would
have been earned if the interest had been paid for a full year.
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| |
| Q. |
Can the method in which interest payments are made be changed throughout the life of the Ontario Savings Bond?
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| A. |
Yes. The request to change the method in which interest payments are made must be made through the
Registrar, at least 15 days prior to any interest payment date.
A Change of Information Form
must be completed and mailed to the Registrar. Changes to direct deposit information are not accepted
on a Redemption Date or during the 15 days immediately preceding.
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| Q. |
If there is a change to direct deposit information and the Registrar is not notified, how are future interest payments affected?
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| A. |
If the Registrar does not have the correct direct deposit information, the interest payments will not
be successfully deposited into the bondholder's account. As a result, a cheque
for the unsuccessfully deposited interest payment will be forwarded
to the bondholder's address currently on file. It is the
bondholder's responsibility to contact the Registrar with any
corrections or changes to existing financial information.
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| Q. |
What information is required in order to change direct deposit information?
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| A. |
In order to change direct deposit information, a
Change of Information Form must be
completed and sent to the Registrar, at least 15 days prior to the interest payment date.
Changes to direct deposit information ARE NOT accepted over the telephone or by fax.
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| Q. |
Does the interest earned on Ontario Savings Bonds have to be reported on yearly income tax returns?
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| A. |
For tax-related inquiries, please contact Canada Revenue Agency directly at 1-800-959-8281.
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