Your pension could be your most valuable asset, exceeding even the value of your home. Under Ontario’s Family Law Act, pension benefits accumulated during your marriage must be included in the calculation of family property to be shared when you separate. This does not mean you must split your pension. Your pension may not be affected at all if your former spouse has a pension of similar value, or other assets that balance out your pension.

New legislation proclaimed

In May 2009, new legislation was proclaimed that will change the way pensions are divided on conjugal breakdown. Bill 133, the Family Law Statute Amendment Act, includes numerous amendments to the Pension Benefits Act and the Family Law Act. An effective date for the amendments has yet to be determined.

All of the information included in this section is based on current legislation. Separation agreements that are signed or court orders made before Bill 133's effective date will fall under existing rules. Agreements signed or court orders made after the effective date will fall under the new rules. We will provide additional details once the new legislation becomes effective.

If you have separated from your spouse but have not yet signed a separation agreement, contact a family lawyer for advice on how the transition provisions may impact you.

Key facts

If you will be assigning pension benefits to your former spouse, here are the key facts and steps to take into account under existing legislation.

1. Under pension law, you can assign up to 50% of the pension accrued during your marriage to your former spouse.
   
   
2. To divide your pension, we require a certified separation agreement or court order issued in Ontario. We cannot act on court orders from other jurisdictions.
   
   
3. Pension benefits can be divided only when your pension begins or when we pay a termination of membership or death benefit.
   
   
4. If you retired after 1988, the spouse you were living with when you received your first pension payment cannot be disentitled from survivor benefits.
   
   
5. Both you and your spouse should seek independent legal and actuarial advice before agreeing to any benefit splitting arrangement. We cannot provide this advice.
   
   
6. We need your written consent to supply personal information to your lawyer, actuary, former spouse or other third party.
   
   
7. Commuted value estimates available on iAccess Web, the secure members-only section of our website, or in any printed pension statement, are not suitable for use in calculating assets in a marriage breakdown.

Steps to take

1. Value your pension

• Hire an actuary to determine the present value of your pension for family asset purposes.

 

2. Prepare your agreement
   

• Refer your lawyer to our marriage breakdown guidelines (85 KB PDF) to help in the preparation of a pension splitting arrangement.
• Ask us to review your draft separation agreement to ensure we can comply with its terms.
• Once you have a signed agreement, send us a copy so we can act on it.

 

3. Provide us with information to administer your agreement
   

• We need to know where to deposit payments for both you and your former spouse.
• You and your former spouse are treated separately for income tax purposes. We deduct income tax from both your pension payment and your former spouse’s payment based on your individual tax rates.
  

Where to find help
Lawyers

1. The Law Society of Upper Canada provides a lawyer referral service. If you are a Bell Canada customer, call 1-900-565-4577 to access this service. A small fee will automatically be added to your phone bill.

Actuaries

1. The Canadian Institute of Actuaries maintains an online directory to help the public find local actuaries in good standing.