Date: March 8, 2019
To all plan administrators,
In July 2018, the Office of the Superintendent of Financial Institutions (OSFI) consulted all plan administrators by email about proposed amendments to the Assessment of Pension Plans Regulations made under the OSFI Act. OSFI did not receive any concerns or objections and moved forward with the proposed amendments.
The Regulations Amending the Assessment of Pension Plans Regulations were published in Part II of the Canada Gazette on March 6, 2019 and will come into force on April 1, 2019.
As previously communicated to plan administrators by email and as described in the last issue of InfoPensions (Nov 2018), the amendments will streamline the assessment process and eliminate assessments for certain terminated pension plans.
OSFI-issued invoice instead of self-assessment form: The amendments enable the Superintendent to determine a pension plan’s assessment after the plan has filed its Application for Registration or its Annual Information Return (AIR). OSFI will determine the assessment due and send an invoice to all plans
- that file an Application for Registration on or after April 1, 2019; or
- with AIRs due to be filed on and after April 1, 2019.
OSFI expects to prepare the invoice approximately 45 days after determining the assessment. For example, if a plan’s AIR is due by June 30, 2019, the plan administrator can expect to receive an invoice in August 2019 even if they have filed the AIR before its due date. Plan administrators will no longer be required to complete a Pension Plan Assessment Remittance Form. However, if an assessment was sent in advance of the due date for the AIR using this form, the assessment will still be accepted and an invoice will not be issued.
Elimination of assessments for certain terminated pension plans: The amendments specify that there is no assessment to be paid in the following two scenarios:
- The plan has been terminated for five or more pension plan years
- The pension plan is underfunded on the termination date and either the pension plan is a negotiated contribution plan (a multi-employer plan with employer contributions limited to an amount determined by an agreement) or the employer for the plan is bankrupt or insolvent, or undergoing proceedings under the Companies’ Creditors Arrangements Act.
Clarification to the definition of beneficiary: The amendments clarify that members, survivors or any other persons who chose to transfer their pension benefit credit out of the plan before or after plan termination are not included as beneficiaries (which means that they are not considered for purposes of the assessment calculation). The amendments also clarify that any person for whom the administrator has purchased an annuity as part of the wind-up of a terminated plan is not considered a beneficiary for purposes of the assessment calculation.
If you have any questions, please contact OSFI at firstname.lastname@example.org.