Retirement Services - Nova Scotia Pension Legislation
 |
Pension Benefits Act
Original: January 1, 1977
Reform: January 1, 1988
Year last amended: 2003
|
Index
Benefit Splitting
Cash Availability at Termination of Employment
Definition of Spouse
Early Retirement
Eligibility
Employee Excess Contributions
Flexible Pension Plan
Indexing of Pensions
Integration with Governmental Plans
Minimum Employer Contribution – 50% Rule
Minimum Interest Rate on Employee Contributions
Normal Retirement
Options Available on Pre-Retirement Death
Portability at Termination of Employment for a Member Entitled to a Deferred Annuity
Post-Retirement Death Benefits
Postponed Retirement
Pre-Retirement Death Benefits
Sex Discrimination
Vesting and Locking-In
Vesting at Normal Retirement Date
Disclaimer
Benefit Splitting
(Breakdown of marriage or of conjugal relationship)
- Benefits may be split in accordance with a court order or separation agreement (maximum 50%).
- Benefits splitting may take place:
Defined Benefits
- only on the member’s normal retirement date or on the date when pension benefits start being paid, whichever comes first.
Defined Contributions
- either immediately in the form of a locked-in transfer, or at some time in the future, up to the spouse’s retirement age.
top
Cash Availability at Termination of Employment
Plan may provide for refund of:
- 25% of commuted of deferred pension (pre-1988 benefits); and
- Commuted value of pension if annual pension* is less than 2% of YMPE.
*Excluding the refund made in 1 above.
top
Definition of Spouse
On the date of the member’s retirement or on the day of the member’s death, if earlier:
The person who is married to the member;
The person who is married to the member by a marriage that is voidable and has not been annulled by a declaration of nullity;
In good faith, the person who has gone through a form of marriage with the member that is void and who is cohabitating or, if they have ceased to cohabit, has cohabitated with the member within the 12-month period immediately preceding the date of entitlement.
“Common-law partner” of an individual means another individual who has cohabitated with the individual in a conjugal relationship for a period of at least two years, neither of them being a spouse.
top
Early Retirement
Within 10 years of normal retirement date.
top
Eligibility
Full-time employees: 2 years of continuous service.
Part-time employees: 2 years of continuous service and annual earnings at least 35% of YMPE or 700 hours worked in each of 2 consecutive calendar years immediately preceding membership.
top
Employee Excess Contributions
Reimbursed.
top
Flexible Pension Plan
No requirement.
top
Indexing of Pensions
(Defined Benefit Plans)
No requirement.
top
Integration with Governmental Plans
(Defined Benefit Plans)
Reduction on account of the OAS: pro-rata formula required (35 years) for years of service before 1988. Prohibited for years of service after 1987.
Reduction on account of the CPP/QPP: pro-rata formula required (35 years).
top
Minimum Employer Contribution-50% Rule
(Defined Benefit Plans)
At least 50% of commuted value of pension benefits accrued from January 1, 1988.
top
Minimum Interest Rate on Employee Contributions
Defined Contribution Plan: fund rate of return based on market value of investments.
Defined Benefit Plan: fund rate of return or the average yield on personal 5-year term deposits with chartered banks over a recent period not exceeding 12 months.
top
Normal Retirement
No later than 1 year following 65th birthday.
top
Options Available on Pre-Retirement Death
Spouse: cash, RRP, RRSP, RRIF.
Dependent child/grandchild: cash, Fixed term annuity to age 18.
Other beneficiary: cash.
top
Portability at Termination of Employment for a Member Entitled to a Deferred Annuity
More than 10 years before normal retirement date.
Options:
-Transfer to: another pension plan, a locked-in RRSP, a LIF (if within 10 years of normal retirement age provided under the plan text).
- Purchase of a life annuity contract.
top
Post-Retirement Death Benefits
Joint pension continues at 60% after death of either spouse or common-law partner. Possibility to waive joint pension by spouse or common-law partner and member within 12 months of pension commencement.
top
Postponed Retirement
(At the latest December 31 of the year in which the member reaches age 69)
Membership may continue except if the member is receiving a pension.
top
Pre-Retirement Death Benefits
Pre-1988 benefits: no requirement.
Post-1987 benefits: if surviving spouse or common-law, not less than 60% of commuted value of vested benefits (not locked-in).
If no surviving spouse or common-law partner, member’s contributions with interest to the designated beneficiary, or failing that, to the estate (not locked-in).
top
Sex Discrimination
Sex discrimination required = annuity rate based on sex;
Sex discrimination prohibited = unisex annuity rate;
Sex discrimination allowed = annuity rate based on sex or unisex annuity rate
Years of service before 1988: discrimination allowed.
Years of service after 1987: discrimination prohibited.
top
Vesting and Locking-In
(Excluding voluntary contributions and optional ancillary contributions)
Benefits accrued from 1977 to 1987: age 45 plus 10 years of continuous service or plan membership.
Post-1987 benefits: 2 years of plan membership.
top
Vesting at Normal Retirement Date
Entitlement to a pension vests at normal retirement date only if minimum vesting and locking-in requirements are met.
top
Disclaimer
The information contained in this summary applies only to single employer Registered Pension Plans (RPPs). In addition, this information states the minimum rules provided under the pension legislation that governs RPPs. However, it does not state the maximum rules under the Income Tax Act (Canada) and its Regulations that also apply to RPPs.
The legislation and the regulations of this jurisidiction prevails over this summary. While every effort has been made to ensure the accuracy of the information, no warranty is expressed or implied as to the accuracy, adequacy or completeness of the information, and the CUMIS Life Insurance Company is not responsible for any errors, omissions, or from the results from the use of such information.
top
|
