Waiver and Surrender of Spousal Benefits

Subsection 22(5) of the Pension Benefits Standards Act, 1985 (PBSA) (post-retirement death benefits) provides that a surviving spouse or common-law partner can waive all or a portion of their survivor benefits by completing the prescribed spousal waiver form. The prescribed form must be completed and provided to the plan administrator before the member’s retirement. When the retired member dies, any benefit will be paid in accordance with the spousal waiver and the pension option the member chose at retirement.

Spousal waivers must contain all of the information as prescribed in Form 4 of Schedule II to the Pension Benefits Standards Regulations, 1985.

Should a member die before retirement, the death benefit must be paid in accordance with section 23 of the PBSA (pre-retirement death benefits). Any spousal waiver form on file does not apply if the member dies before retirement.

Subsection 23(5) of the PBSA provides that a pension plan may provide that a survivor may, after the death of a member or former member, surrender (not waive), in writing, the pension benefit or pension benefit credit to which the survivor is entitled and designate a beneficiary who is a dependent, within the meaning of subsection 8500(1) of the Income Tax Regulations, of the survivor, member or former member.

A plan member without a spouse or common-law partner at the time of their retirement can elect to receive the normal form of benefit or any optional form provided under the terms of the plan. If the member subsequently acquires a spouse or common-law partner, there is no requirement that the remaining benefit be converted to a joint and survivor form.

Replaces Article Published in PBSA Update, Issue No. 26 September 2006