The Pension Benefits Division Act (PBDA)

Distribution:

All requests for pension benefits information and applications for division of a Public Service Superannuation Act pension are to be sent directly to the following address:

Superannuation, Pension Transition and Client Services Sector
Public Works and Government Services Canada
P.O. Box 5010
Shediac, NB
E4P 9B4

The Minister in charge of administering the PSSA has set up a formal application process for the division of pension benefits for PSSA plan members. Once eligible applicants have submitted all the necessary data, a computer system performs complex calculations to arrive at the division amount.

To be able to calculate this amount, we need specific information about the member's service record and the period subject to division. In addition, we need specific facts about both parties involved in the division. These facts help us determine the correct identity of the parties involved.

In either case, they must have a court order, or written spousal agreement signed by both spouses, that provides for the division of the member's pension benefits.

There are three separate steps in the pension benefits division process:

These steps are described in further detail in other sections of this guide.

All information about the pension division estimate and application processes is available from the PBDA Information Kit or by contacting the Superannuation, Pension Transition and Client Services Sector at the following address and toll free number:

Superannuation, Pension Transition and Client Services Sector
Public Works and Government Services Canada
P.O. Box 5010
Shediac, NB
E4P 9B4

Toll free: 1 800 883-1411

Yes, as long as you make a request for the information in writing, and the request contains the information required. For members under the PSSA, you must fill out specific forms, as described below.

You will be notified after the pension benefits have been divided and transferred into a registered retirement vehicle. If you wish an estimate of the amount involved before the division is approved, you must formally request information on pension benefits before you apply for a division.

You must fill out the form entitled "Request for Pension Benefits Division Information" (PWGSC-TPSGC 2488). The member's name is essential. Closely follow the detailed instructions provided with the form.

In order to calculate the estimate, we need the period of time you have lived together.

You will receive a Pension Benefits Report. It contains an estimate of the maximum amount allowable for division, based on the value of the member's pension benefits acquired during a period of marriage or common-law relationship. You will also receive a general explanation on how to interpret the report ADM 270E.

If the estimate is requested by a contributor, an estimate of the resulting reduced pension will also be provided.

The amount quoted is the maximum amount that could be transferred calculated on the date the report is prepared. The estimate is based upon the information that you provided on the request form and the information readily available in our own records. The maximum transferable amount can change significantly with changes from month to month in interest assumptions or if the member's employment status in the public service changes.

Each member is entitled to request an estimate through the request for information process.

It is the process by which, as the member, spouse or former spouse, you can formally request a division of the pension benefits acquired by the member during the period you lived together.

Eligible applicants are:

In either case, there must be a court order or written spousal agreement signed by both spouses providing for the division of a member's pension benefits between the member and the spouse or former spouse.

No. You must submit a formal application for division of pension benefits. Also, a division can be done only if you have a court order or written spousal agreement that provides for a division of the member's pension benefits.

As long as you have a court order or written spousal agreement, you can apply for a division of pension benefits at any time, subject to a minimum one-year separation, if applicable (see question 2 above).

You must fill out the form entitled "Application for Division of a Public Service Superannuation Act Pension" (PWGSC-TPSGC 2486). Closely follow the detailed instructions provided with the form.

You must attach a certified true copy of the court order or written spousal agreement that provides for division of pension benefits. The copy must be certified by a court official, a lawyer, a notary public or a commissioner of oaths..

If your court order or spousal agreement does not:

You must complete and sign the Statutory Declaration entitled "in the Matter of an Application for Division of Pension Benefits under the Pension Benefits Division Act " (PWGSC-TPSGC 2484), and have your signature witnessed by an authorized person. The Statutory Declaration outlines the periods of cohabitation (and any applicable interruptions), which are necessary to calculate the division amount.

There are also other documents that you may be requested to provide during the application process.

Without a court order or written spousal agreement directing the division of pension, there can be no division.

You can still apply for a division, as long as the court order or written spousal agreement provides for the division of the member's pension benefits.

When an application for division has been received, a notice of the application for division and a copy of the court order or written spousal agreement that accompanied the application will be sent to the other party involved.

You have up to 90 days after the date on the notice of application for division to file a notice of objection with the organization responsible for the pension plan.

There are three grounds for objection:

The application is put on hold until the objection is resolved.

Yes, the application for division will be refused unless or until there is a new court order or agreement that allows for the division to proceed. The application for division can also be refused if, as a result of a dispute between the parties about the dates of cohabitation, the administration cannot determine the period subject to division, or if it is determined that proceeding with the division would be unjust.

Once the objection period is over, the division will be approved and processed.

The pension benefits subject to division are those under a federal public sector pension plan that a plan member has acquired during the period in which the spouses lived together during a marriage or common-law relationship.

"Pension Benefits" include any annuity, annual allowance, transfer value or return of contributions, but do not include surviving spouse allowances and children's allowances.

If the division is approved, the spouse's (or former spouse's) share is transferred as a lump sum amount directly to a retirement savings vehicle chosen by the spouse or former spouse.

You can choose a plan or fund administered in accordance with the lock-in provisions of the federal Pension Benefits Standards Act (PBSA), or have the funds transferred to another registered pension plan or to a life insurance company for the purchase of an immediate or deferred life annuity.

In some cases, a portion of the spouse's (or former spouse's) share may be payable from a Retirement Compensation Arrangement (RCA). An RCA provides for benefits similar to the PSSA that cannot be paid under a registered pension plan. The portion of the division payment in respect of RCA benefits is paid directly to the recipient and taxed accordingly.

Yes, as long as the accounts are all registered retirement vehicles.

If the member has less than two years of service, the amount can either be locked-in or not. If the member has more than two years service, the lump sum amount must be locked-in. Your financial institution is responsible for certifying that the funds will be administered in accordance with the lock-in provisions of the federal Pension Benefits Standards Act (PBSA), and will be able to provide you with information regarding acceptable transfer vehicles.

If you are currently contributing under the Public Service Superannuation Act, you can use the amount as contributions for payment towards an ongoing, valid election. If you cannot buy back elective service, you must have the amount transferred into a retirement vehicle. If you are not a federal government employee, you can use the lump sum to increase your pension plan only if it so permits. Otherwise, you must have the division amount transferred into a registered retirement vehicle.

Since the amount except for any portion payable from an RCA is transferred into a locked-in retirement savings vehicle, taxes do not apply until you start receiving periodic benefits (i.e. monthly payments). If there is a portion payable from RCA benefits (refer to question 2), the amount will be paid directly to the recipient, and is subject to a withholding of tax at source as it is taxable income for the year in which it is paid.

Yes, but only if payments for elective service were made during the period subject to division. This also applies for leave without pay repayments.

Depending on the terms of the court order or written spousal agreement, the lump sum amount can equal up to 50% of the value of the member's pension benefits acquired during the period subject to division. This value will be the actuarial present value of the plan member's pension benefits determined by generally accepted actuarial principles.

Calculations based on generally accepted actuarial principles involve converting assumed future pension payments into one lump sum amount, estimated on a specified date, using actuarial assumptions about future interest rates and about the plan member's life expectancy and retirement date. The assumptions that will be used for the PBDA are consistent with the recommendations of the Canadian Institute of Actuaries for the computation of transfer values from registered pension plans.

Not necessarily. If the court order or written spousal agreement provides for the transfer of a smaller lump sum amount, this smaller amount, plus interest if applicable, will be transferred to a retirement savings vehicle chosen by the spouse or former spouse.

Yes. The member's pension benefits are subject to division regardless of whether or not the member is receiving monthly pension benefits. The maximum transferable amount is based on the value of future pension payments only; payments made to the member prior to division are not included in the value. After division, the plan member's monthly pension benefits will be reduced to reflect the division.

In no case, however, are the member's pension benefits for the period subject to division reduced more than 50% of their value before division.

Not directly. The PBDA provides only for the transfer of a lump sum amount from the pension fund to a locked-in retirement savings vehicle. You will receive a form of pension from the retirement savings vehicle when you convert the retirement savings to periodic payments.

The fact that the member is disabled and receiving an annuity for medical reasons has no effect on the way the division amount is calculated. Both the division payment and the reduction to the member's benefits are based on the pension entitlement that would have been payable if the member had not been disabled.

If you have received a lump sum amount for the years of your marriage or common-law relationship, you cannot receive a survivor benefit for the same period.

After a notification of application for division has been sent to both parties, the PBDA requires a 90-day waiting period for the objection process. If no objection is received, it will be processed. The transfer will occur as soon as possible after that.

An application may be withdrawn by the applicant at any time up until the amount is transferred to the spouse's or former spouse's registered retirement vehicle.

If you are the member, you must fill out the following:

Print the surname, given name(s), social insurance number (SIN), and the full address of the member's spouse or former spouse.

You must include a certified true copy of the Court Order or Spousal Agreement that provides for the division of the plan member's pension benefits.

NOTE: If this document is missing, your application will be rejected and returned to you.

You must include the Statutory Declaration, entitled "In the Matter of an Application for Division of Pension Benefits Information under the Pension Benefits Division Act " (PWGSC-TPSGC 2484), duly completed, signed and witnessed if:

You must include an original or certified true copy of your Certificate of Marriage if you are not divorced.

You were not married to one another, but have lived together for at least one year, and have lived separate and apart for at least one year.

1.

Instructions on how to direct pension benefits funds. You must state in writing to which registered retirement vehicles you wish the amount to be transferred (forms to that effect can be obtained from the administrator of the registered retirement plans you have chosen).