Pension Benefits Division Regulations

Regulations Respecting the Division of Pension Benefits His Excellency the Governor General in Council, on the recommendation of the President of the Treasury Board, pursuant to subsection 4(4), section 5, subsections 7(3), 8(1), (4), (6) and (7) and 13(2) and sections 14 and 16 of the Pension Benefits Division Act*, hereby makes the annexed Regulations respecting the division of pension benefits, effective on the later of S.C. 1992, c. 46 (Sch. II) the day on which these Regulations are made, and the day on which the Pension Benefits Division Act comes into force. These Regulations may be cited as the Pension Benefits Division Regulations. In these Regulations, Act means the Pension Benefits Division Act; (Loi) annuity means, in respect of a member, a benefit calculated in accordance with subsection 11(1) of the Public Service Superannuation Act, subsection 15(1) of the Canadian Forces Superannuation Act, subsection 10(1) of the Royal Canadian Mounted Police Superannuation Act, section 14, 15, 16, 17, 36 or 37, or subsection 48(1), as applicable, of the Members of Parliament Retiring Allowances Act, subsection 5(2) of the Diplomatic Service (Special) Superannuation Act, subsection 3(2) of the Lieutenant Governors Superannuation Act, section 6 of the Governor General’s Act, subsection 3(1) of the Defence Services Pension Continuation Act, R.S.C. 1970, c. D-3, in respect of an officer or subsection 13(1) of that Act in respect of a militiaman, and section 10 of the Royal Canadian Mounted Police Pension Continuation Act, R.S.C. 1970, c. R-10, in respect of an officer or subsection 34(1) of that Act in respect of a constable; (rente) applicant includes a personal representative and a person acting on behalf of an interested party; (demandeur) CPP deduction means the deduction from a member’s annuity required under the member’s pension plan when the member reaches 65 years of age or is in receipt of a pension by reason of disability under paragraph 44(1)(b) of the Canada Pension Plan or a provision of a similar provincial pension plan; (déduction RPC) division annuity means the amount equal to the product of the amount of the member’s annuity determined as if the member ceased to be employed on the earlier of separation day and termination day, and the ratio of the number of years of pensionable service to the credit of the member under the member’s pension plan accrued during the period subject to division to the total number of years of pensionable service to the credit of the member under the member’s pension plan on separation day; (rente de partage) division annuity deduction means the amount equal to the product of the amount of the CPP deduction determined as if the member ceased to be employed on the earlier of separation day and termination day, and the ratio of the number of years of pensionable service after 1965 to the credit of the member under the member’s pension plan accrued during the period subject to division to the total number of years of pensionable service after 1965 to the credit of the member under the member’s pension plan on separation day;(déduction de la rente de partage) division factor means the factor determined in accordance with subsection 19(1); (facteur de partage) employed includes holding an office, being a participant within the meaning of Part I of the Retirement Compensation Arrangements Regulations, No. 1 who is required to contribute to the Retirement Compensation Arrangements Account, being a member of the Senate or the House of Commons or serving in the Canadian Forces or the Royal Canadian Mounted Police; (employé) indexed reduction means the amount equal to the product of the division factor and the lesser of the indexed division annuity, and the retirement annuity; (réductionindexée) indexed reduction adjustment[Repealed, SOR/97-420, s. 1] interested party means an interested party within the meaning of subsection 5(4) of the Act; (intéressé) minimum death benefit means, with respect to a member, the benefit payable under section 27 of the Public Service Superannuation Act, section 38, 39 or 40 of the Canadian Forces Superannuation Act, section 22 of the Royal Canadian Mounted Police Superannuation Act, and section 61 of the Members of Parliament Retiring Allowances Act; (prestation minimale de décès) pension includes a pension, an annual allowance or an annuity payable under a pension plan; (pension) recipient, in respect of a member, means that the member is a recipient as defined in section 74 of the Canadian Forces Superannuation Act, section 35 of the Royal Canadian Mounted Police Superannuation Act, section 64 of the Public Service Superannuation Act, or section 2 of the Supplementary Retirement Benefits Act, or a member receiving supplementary benefits under Part IV of the Members of Parliament Retiring Allowances Act; (prestataire) reduction means the amount equal to the product of the division factor and the lesser of the division annuity, and the retirement annuity; (réduction) reduction adjustment means the amount equal to the product of the division factor and the retirement annuity deduction; (réduction révisée) retirement annuity means the amount equal to the product of the amount of the member’s annuity on termination day, and the ratio of the number of years of pensionable service to the credit of the member under the member’s pension plan accrued during the period subject to division to the total number of years of pensionable service to the credit of the member under the member’s pension plan on termination day; (rente de retraite) retirement annuity deduction means the amount equal to the product of the amount of the CPP deduction, and the ratio of the number of years of pensionable service after 1965 to the credit of the member under the member’s pension plan accrued during the period subject to division to the total number of years of pensionable service after 1965 to the credit of the member under the member’s pension plan on termination day; (déduction de la rente de retraite) return of contributions, with respect to a member of a pension plan provided under the Public Service Superannuation Act, has the same meaning as in subsection 10(1) of that Act, the Canadian Forces Superannuation Act, has the same meaning as in section 10 of that Act, the Royal Canadian Mounted Police Superannuation Act, has the same meaning as in subsection 9(1) of that Act, the Members of Parliament Retiring Allowances Act, means a withdrawal allowance determined in accordance with section 18 or 38 of that Act, the Diplomatic Service (Special) Superannuation Act, means a return of contributions referred to in subsection 5(8) of that Act, and the Lieutenant Governors Superannuation Act, means a return of contributions referred to in subsection 3(4) of that Act; (remboursement de cotisations) separation day means the day following the last day of the period subject to division; (date de séparation) termination day means the day a member ceases to be employed; (date de cessation d’emploi) valuation day means the day in respect of which the determination of the value of a member’s pension benefits is made pursuant to these Regulations; (date d’évaluation) vested, [Repealed, SOR/2003-408, s. 1] For the purposes of these Regulations, a member’s pension plan is the plan in respect of which an application for a division or a request for information has been made. For the purposes of these Regulations, pensionable service to the credit of a member under the member’s pension plan accrued during the period subject to division includes all pensionable service that is current service during the period subject to division, less any period of absence on leave without pay; any period of elective service, other than a period described in paragraph (e), to the credit of the member at separation day in the proportion that the contributions in respect of the elective service paid by or on behalf of the member during the period subject to division bears to the total amount of the contributions required to be paid for that elective service; any period of service during which the member was absent on leave without pay in the proportion that the amount of contributions made by or on behalf of the member during the period subject to division bears to the total amount required to be paid by the member for the purpose of considering the total period of leave without pay as pensionable service; any period of pensionable service credited to the member before valuation day by reason of a transfer of funds from another pension plan or pursuant to a reciprocal transfer agreement or a pension transfer agreement in the proportion that the period credited to the member under that other plan in respect of the period subject to division bears to the total period of pensionable service to the credit of the member under the other plan; and any period of service credited to the member before valuation day by reason of an election made under clause 6(1)(b)(iii)(M) of the Public Service Superannuation Act, in the proportion that the period of pensionable service that accrued during the period subject to division that was included in the determination of the transfer value referred to in that clause bears to the total period of pensionable service represented by the payment of that transfer value. For the purposes of these Regulations, except section 18, if a member of a pension plan referred to in paragraph (a) of the definition pension plan in section 2 of the Act is subject to a retirement compensation arrangement established under section 10 or 11 of the Special Retirement Arrangements Act and is required to contribute to or is eligible to receive benefits from the Retirement Compensation Arrangements Account, and those benefits are determined by reference to the benefits payable under that pension plan, the pension benefits accrued under that retirement compensation arrangement are considered to have been accrued under that pension plan. For the purposes of these Regulations, a member is considered vested if the member is entitled to receive a pension or would be entitled to receive a pension if he or she ceases to be employed. For the purposes of paragraph 4(4)(a) of the Act, an application shall contain the following information: in respect of the member, the member’s name, the member’s most recent address that is known to the applicant, the member’s date of birth, the most recent place of employment of the member in the public service of Canada that is known to the applicant, the day on which the member has ceased to be employed in the public service of Canada, where applicable, if that day is known to the applicant, and the member’s employee identification number, regimental number or pension number, as the case may be, if that number is known by the applicant; and in respect of the spouse, former spouse or former common-law partner of the member, that person’s name, and the most recent address of that person known to the applicant. For the purposes of paragraph 4(4)(b) of the Act, if the court order or agreement does not specify the period of cohabitation or the period subject to division, the application shall be accompanied by the following documents: if the interested parties are or were married to each other, an original or certified true copy of the certificate of marriage and a statutory declaration by the applicant stating the date on which they ceased to cohabit; and if the interested parties were not married to each other, a statutory declaration by the applicant stating the date on which the member and the spouse or former common-law partner began to cohabit in a relationship of a conjugal nature and the date on which that cohabitation ceased. Where the applicant making or proceeding with the application is acting on behalf of an interested party, the original or a certified true copy of the document that authorizes the applicant to act for the interested party shall, in addition to the documents that may be required pursuant to subsection 3(2), be submitted to the Minister. Subject to section 6, where the applicant making or proceeding with the application is the personal representative of a deceased interested party, the following documents shall, in addition to the documents that may be required pursuant to subsection 3(2), be submitted to the Minister: the original or a certified true copy of the document that authorizes the applicant to act in that capacity; the original or a certified true copy of the death certificate of the interested party; and evidence that the terms of the court order or agreement remain in force. A person may make an application on behalf of an interested party or may act on behalf of an interested party in prosecuting an application where the interested party is incapable of managing their own affairs. If the spouse, former spouse or former common-law partner of a deceased member makes an application, he or she shall submit to the Minister a statutory declaration stating that the terms of the court order or agreement have not been or are not being satisfied by other means. An applicant may, by notice in writing to the Minister, withdraw the application at any time before a transfer is effected pursuant to paragraph 8(1)(a) of the Act. The notice referred to in subsections 5(1) and 8(7) of the Act shall be sent by the Minister by registered mail. A request for information referred to in subsection 13(2) of the Act shall be in writing and be accompanied by if there is a court order or agreement, a certified true copy of the court order or agreement, and in the following circumstances, a statutory declaration by the spouse or former spouse or common-law partner or former common-law partner that meets the requirements set out in subsection (2): the court order or agreement does not specify the period of cohabitation or the period subject to division, or an appeal or review referred to in paragraph 6(2)(c) of the Act has been commenced in respect of the period of cohabitation or the period subject to division; if there is no court order or agreement, a statutory declaration by the spouse or former spouse or common-law partner or former common-law partner that meets the requirements set out in subsection (2). The statutory declaration must state in the case of a spouse or former spouse, the date of marriage and the date on which he or she ceased to cohabit with the member or, if the spouse and member have not ceased to cohabit, that it is his or her intention to cease cohabiting; and in the case of a common-law partner or former common-law partner, the date on which he or she began to cohabit with the member in a relationship of a conjugal nature and the date on which that cohabitation ceased or, if the common-law partner and member have not ceased to cohabit, that it is his or her intention to cease cohabiting. In sections 10 to 12, parties means the member and the spouse, former spouse, common-law partner or former common-law partner who makes a request for information under subsection 13(2) of the Act. Subject to subsection (3), the following is the information to be provided by the Minister in response to a request under subsection 13(2) of the Act: the day on which the information is prepared; the day on which the member first received a pension other than a pension by reason of disability, will be eligible to receive a pension that is not reduced on account of age, or would have received a pension that is not reduced on account of age had the member not become entitled to a pension by reason of disability; the period subject to division; if the member is not vested on the day on which the information is prepared, the amount of contributions made by the member in respect of pensionable service accrued during the period subject to division and the interest on the contributions; the amount paid by the member during the period subject to division in respect of any period of elective service and the period of service included in the period subject to division, determined in accordance with paragraph 2(3)(b); the amount of the member’s division annuity; any period of pensionable service credited to the member under a reciprocal transfer agreement or a pension transfer agreement in respect of the period subject to division, determined in accordance with paragraph 2(3)(d); the amount of any minimum death benefit payable on the death of the member in respect of the period subject to division, determined as though there were no surviving spouse, surviving common-law partner or dependent children; the amount of the supplementary death benefit payable on the death of the member, determined as of the day on which the information is prepared; the amount that would be determined in accordance with paragraph 8(1)(a) of the Act if valuation day were the day on which the information was prepared; and any period of service credited to the member by reason of an election made under clause 6(1)(b)(iii)(M) of the Public Service Superannuation Act, determined in accordance with paragraph 2(3)(e). For the purposes of subsection (1), if the period subject to division cannot be determined under paragraph 8(2)(a) of the Act, the period subject to division begins on the day of marriage or, in the case of common-law partners, on the day on which they began to cohabit in a relationship of a conjugal nature, and ends on the day on which the parties ceased to cohabit, as stated in the statutory declaration referred to in subsection 9(2); or on the last day of the month preceding the month in which the request for information is made, if the parties have not ceased to cohabit. The following is the information to be provided by the Minister in response to a request under subsection 13(2) of the Act made after the division of the member’s pension benefits under the plan in respect of which the request is made: where the member was not vested on valuation day, the amount of contributions made by the member in respect of pensionable service accrued during the period subject to division and the interest on the contributions; the amount paid by the contributor during the period subject to division in respect of any period of elective service and the period of service included in the period subject to division, determined in accordance with paragraph 2(3)(b); the amount of the member’s division annuity on valuation day; the amount of any minimum death benefit that, on valuation day, would have been payable on the death of the member in respect of the period subject to division, determined as though there were no surviving spouse, surviving common-law partner or dependent children; the amount that, but for subsection 8(4) of the Act, would have been transferred in accordance with paragraph 8(1)(a) of the Act; and The Minister may refuse to provide information in response to a request for information made by a spouse, former spouse, common-law partner or former common-law partner under subsection 13(2) of the Act or section 12 if the Minister has responded within the preceding 12 months to a similar request made by that person, unless, since that previous request, the parties have ceased to cohabit; the member or his or her spouse, former spouse, common-law partner or former common-law partner began proceedings in relation to separation, divorce or annulment; the parties entered into an agreement; or the member’s pensionable service included in the period subject to division has been adjusted. If a court in Canada of competent jurisdiction has ordered that a spouse, former spouse, common-law partner or former common-law partner be designated as the beneficiary of the supplementary death benefit provided under Part II of the Public Service Superannuation Act or Part II of the Canadian Forces Superannuation Act, or the parties have agreed in writing to such a designation, the Minister shall, at the written request of the spouse, former spouse, common-law partner or former common-law partner, inform that person whether he or she is the designated beneficiary and the amount of the supplementary death benefit that would be payable to him or her. For the purposes of section 8 of the Act, the value of pension benefits that have accrued to a member during the period subject to division is equal to where the member is vested at valuation day, the actuarial present value on valuation day of the member’s pension benefits accrued during the period subject to division, determined in accordance with sections 14 and 15; and where the member is not vested at valuation day, the amount determined under section 16. The accrued pension benefits of a member shall be determined in accordance with the member’s pension plan and, where applicable, the Supplementary Retirement Benefits Act, subject to the following rules: any reference in the member’s pension plan to an annuity shall be replaced by a reference to a division annuity; any reference in the member’s pension plan to the CPP deduction shall be replaced by a reference to the member’s division annuity deduction; the member’s minimum death benefit, if any, shall be determined as if the member’s annuity were the member’s division annuity; any benefits that are or may become payable to the member’s spouse, former spouse, common-law partner or children on the death of the member are to be excluded; and supplementary benefits, including supplementary benefits payable under the Supplementary Retirement Benefits Act, are determined on the basis of the benefit indices established under that Act that would have applied had the member ceased to be employed on the earlier of separation day and termination day, increased to take into account the period beginning on January 1st of the year in which valuation day occurs and ending on valuation day. Where on valuation day, a member is in receipt of a pension by reason of disability, the member’s accrued pension benefits to be valued are the pension benefits that the member would be entitled to if the member were not entitled to a pension by reason of disability. Where a member dies before a transfer is effected pursuant to paragraph 8(1)(a) of the Act, the calculation of the member’s pension benefits shall be made as if the member had not died and if the member was employed on the date of death, termination day shall be deemed to be the day before the date of death; and if the member was in receipt of a pension on the day before the date of death, the member’s accrued pension benefits shall be determined as of the day before the member’s death. In determining the actuarial present value of a member's accrued pension benefits, the following actuarial assumptions are to be used: if the member is employed on valuation day the termination and retirement rates for current contributors, used in the preparation of the last actuarial valuation report for the member's pension plan laid before Parliament, modified to reflect any special conditions that apply to the tenure of office or service or to special benefits in respect of an occupational group of the members of the pension plan, and the mortality rates for current and former contributors, including mortality projection factors, used in the preparation of the report referred to in subparagraph (i), or the mortality rates, including mortality projection factors, referred to in the section entitled “Pension Commuted Values” of the Standards of Practice – Practice-Specific Standards for Pension Plans (the “Standards”), published by the Canadian Institute of Actuaries, as amended from time to time, whichever will produce the greater actuarial present value of a member’s accrued pension benefits; if the member ceased to be employed before valuation day, the mortality rates for former contributors, other than disabled contributors, including mortality projection factors, used in the preparation of the report referred to in subparagraph (a)(i), or the mortality rates, including mortality projection factors, referred to in the Standards, whichever will produce the greater actuarial present value of a member’s accrued pension benefits; a zero probability of a member becoming entitled to a pension by reason of disability; and the interest rates determined in accordance with the Standards, namely, in respect of periods during which the member is a recipient, the interest rates for fully indexed pensions, adjusted to reflect an annual basis of payment, and in respect of periods during which the member is not a recipient, the interest rates for unindexed pensions. The last actuarial valuation report for the pension plans referred to in subparagraphs (a)(iii) and (v) of the definition pension plan in section 2 of the Act shall be the last actuarial valuation report in respect of the pension plans referred to in subparagraphs (a)(ii) and (iv), respectively, of that definition. The last actuarial valuation report for the pension plans referred to in subparagraphs (a)(vi), (vii) and (viii) of the definition pension plan in section 2 of the Act shall be the last actuarial valuation report in respect of the pension plan laid before Parliament under the Public Service Superannuation Act. For the purposes of this section, the last actuarial valuation report is the most recent actuarial valuation report laid before Parliament in accordance with section 9 of the Public Pensions Reporting Act or, if the actuarial valuation report has been tabled in the month in which valuation day occurs or in the preceding month, the immediately previously tabled report. For the purposes of section 8 of the Act, the value of pension benefits that have accrued to a member who is not vested on valuation day is equal to the sum of the contributions made by the member under the member’s pension plan during the period subject to division, and the interest that would have been payable to the member under the member’s pension plan in respect of the amount determined under paragraph (a) had the member begun to be a member of the pension plan on the first day of the period subject to division and ceased to be a member on valuation day. For the purposes of subparagraph 8(1)(a)(ii) of the Act, a retirement savings plan or fund of the prescribed kind is if the transfer is being made in respect of the spouse, former spouse or former common-law partner of a member who is vested at valuation day, a retirement savings plan prescribed for the purposes of section 26 of the Pension Benefits Standards Act, 1985 and administered in accordance with that Act; and if the transfer is being made in respect of the spouse, former spouse or former common-law partner of a member who is not vested at valuation day, a registered retirement savings plan or registered retirement income fund as defined in the Income Tax Act. For the purposes of subparagraph 8(1)(a)(iii) of the Act, immediate life annuity and deferred life annuity, as those expressions are defined in subsection 2(1) of the Pension Benefits Standards Regulations, 1985, are of the prescribed kind. Where an amount has been transferred pursuant to section 8 of the Act, that amount shall be charged to the account from which the member’s pension benefits are or will become payable. In this Part, division factor is 0.5, except that where the amount transferred is a lump sum amount referred to in subsection 8(4) of the Act, the division factor is equal to the product of is the amount determined under subsection 8(4) of the Act, and is the amount determined under these Regulations that, but for subsection 8(4) of the Act, would have been transferred pursuant to paragraph 8(1)(a) of the Act; and where the member was not vested at valuation day and is entitled to a pension under the member’s pension plan on the day the pension benefits are adjusted, the division factor is equal to the product of is the amount transferred under paragraph 8(1)(a) of the Act, and is the amount that, but for subsection 8(4) of the Act, would have been transferred pursuant to paragraph 8(1)(a) of the Act had the member been vested on valuation day. For the purposes of determining the indexed division annuity, if separation day occurs before termination day, the division annuity of a member is to be increased on termination day by the benefit indices established under the Supplementary Retirement Benefits Act that would apply if the member had ceased to be employed on separation day, and further increased to take into account the period beginning on January 1 of the year in which termination day occurs and ending on termination day. Where a transfer has been effected pursuant to section 8 of the Act, the pension benefits of the member shall be adjusted in accordance with sections 21 and 22, where the member is entitled to a pension under the member’s pension plan; in accordance with section 23, where the member is entitled to a return of contributions or a cash termination allowance; in accordance with subsection 23.1(1), if the member has directed that a payment be made to an eligible employer under a transfer agreement entered into under section 40.2 of the Public Service Superannuation Act; and in accordance with subsection 23.1(1.1), if the member has directed that a payment be made to an eligible employer under a transfer agreement entered into under section 24.1 of the Royal Canadian Mounted Police Superannuation Act. The member’s pension benefits shall be adjusted beginning on the later of the day on which a pension is first payable under the pension plan and the first day of the month following valuation day. For the purpose of adjusting a member’s pension benefits, the member’s annuity shall be reduced by an amount equal to the member’s reduction, in respect of any period during which the member is not a recipient; and an amount equal to the member’s indexed reduction, in respect of any period during which the member is a recipient. A reduction or indexed reduction referred to in subsection (2) shall be reduced by an amount equal to the reduction adjustment after the later of the first day of the month after valuation day; and the first day of the month in which a CPP deduction from the member’s annuity is required to be made under the member’s pension plan. Notwithstanding section 21, where a transfer has been effected pursuant to paragraph 8(1)(a) of the Act and the member is entitled to a pension by reason of disability, the reduction of the pension benefits shall begin on the first day of the month following the month during which the member would first be entitled to receive a pension that would not be reduced on account of age; a pension that is reduced on account of age before or after becoming entitled to a pension by reason of disability, the reduction of the pension benefits shall be determined as if the member were not entitled to a pension by reason of disability; or supplementary benefits by reason of disability, the member shall not be considered a recipient for the purposes of subsection 21(2) until the day the member would have become a recipient by reason of age or by reason of age and pensionable service. The return of contributions or the cash termination allowance to which a member is entitled under the member’s pension plan shall be reduced by the product of the return of contributions the member would have been entitled to receive in respect of the period subject to division, determined in the case of a member who is entitled to a cash termination allowance as if the member were entitled to a return of contributions, had there not been a transfer of the member’s pension benefits pursuant to paragraph 8(1)(a) of the Act; and the division factor. Any amount to be paid in respect of a member to an eligible employer pursuant to a transfer agreement entered into under section 40.2 of the Public Service Superannuation Act, or to be paid to the member as a consequence of that payment, shall be reduced by the actuarial present value of the reduction that would have been made to the member’s pension benefits under sections 20 and 21 had the member remained employed in the Public Service. Any amount to be paid in respect of a member to an eligible employer under a transfer agreement entered into under section 24.1 of the Royal Canadian Mounted Police Superannuation Act, or to be paid to the member as a consequence of that payment, shall be reduced by the actuarial present value of the reduction that would have been made to the member’s pension benefits under sections 20 and 21 had the member remained a member of the Royal Canadian Mounted Police. The actuarial present value shall be calculated in accordance with the methodology and assumptions set out in the agreement. Where a transfer has been effected pursuant to paragraph 8(1)(a) of the Act, any minimum benefit payable under the member’s pension plan shall be determined on the basis that the member’s annuity is reduced by the amount of the indexed reduction. Despite any provision of a pension plan, if a division of the pension benefits that have accrued to a member under that pension plan in respect of any period of pensionable service has been effected, the spouse, former spouse or former common-law partner in whose favour the division is effected ceases to be entitled to any pension to which he or she would have been entitled as a surviving spouse or surviving common-law partner in respect of that period of service.