The Financial Services Regulatory Authority of Ontario has released its final pension deregistration guidance, which identifies the documents, information and timeframes that are required under exemptions from the Pension Benefits Act to avoid a plan’s deregistration under the Income Tax Act.
Maintaining ITA registration will permit the pension plan and its members to continue to receive tax deferrals on benefits accrued in the plan and protect the rights of pension plan members across Ontario.
The guidance sets out specific actions, such as pension plan administrators being required to provide written notice to the FSRA. Other considerations include certification, requests for more information and exemptions. The FSRA’s approval of an exemption under certain sections isn’t required if the administrator is acting in compliance with the PBA and regulations.
Plan administrators may also be required to communicate with members affected by certain exemptions, said the guidance, noting there should be advance communications to members who will experience tax implications or those whose benefit will be reduced as a result of the proposed actions.
The FSRA will accept an optional approach for multi-employer pension plans addressing certain over-contributions that would otherwise make the plan revocable under the ITA.