Overview

We are consulting on a proposal to exempt certain individual pension plans (IPPs) and designated plans (DPs) from the Pension Benefits Act (PBA).

The proposed changes would:

  • allow certain IPPs and DPs to elect to be exempt from the PBA
  • automatically exempt certain IPPs and DPs that are established after the date when the proposed amendments would come into force
  • exempt IPPs and DPs that have had their Income Tax Act (Canada) registration revoked from the PBA

In addition to the proposed changes, we also welcome your feedback on which areas, if any, the Financial Services Regulatory Authority of Ontario (FSRA) should be able to make rules for those IPPs and DPs that remain subject to the application of the PBA.

Learn more about the proposed exemptions.

How to participate

There are three ways to share your thoughts – by email, mail or through the Regulatory Registry.

The deadline to submit feedback is January 23, 2020.

Email or mail

Send your feedback to pension.feedback@ontario.ca or by mail to:

Pension Initiatives Unit, Pension Policy Branch
Ministry of Finance
7 Queen's Park Crescent
5th Floor, Frost Building South
Toronto, ON M7A 1Y7

Comment on the Regulatory Registry

Read the proposal and submit your feedback on the Regulatory Registry.

Proposed changes

We are proposing to make the following exemptions from the Pension Benefits Act.

You can also view the draft consultation.

In all cases, the meaning of “connected” comes from subsection 8500 (3) of the Income Tax Regulations(Canada).

1. Connected member individual pension plans and designated plans

Employers of IPPs and DPs registered under the PBA could choose to be exempt from the act if every:

  • member is connected with the employer,
  • former member and retired member was connected with the employer immediately before leaving the company or retiring, and
  • member, former member, retired member and other person entitled to benefits under the plan has consented in writing to the exemption

The effective date of the exemption would need to be set out in the election and filed with the chief executive officer of the Financial Services Regulatory Authority of Ontario (FSRA).

Future Connected-Member IPPs/DPs

If an IPP/DP is established after the date when the proposed amendments would come into force and contains only members who are connected with the employer:

  • it would be automatically exempt from the application of the PBA
  • no election would be required
  • it would not be required to be registered under the PBA

Ongoing requirement

Once a connected member IPP/DP is exempt from the application of the PBA, individuals who are not connected with the employer would not be permitted to join the plan.

The powers and duties of enforcement under the PBA would continue to apply solely to this ongoing requirement.

2. IPPs/DPs whose registration is revoked under the Income Tax Act (Canada)

If an IPP or DP has their Income Tax Act (Canada) (ITA) registration revoked but remains registered under the PBA, it would be automatically exempt from the application of the PBA as of a date set out in the proposed amendments. No election would be required.

3. General

For both types of proposed exemptions listed above, once a plan is exempt from the PBA and subject to the ongoing requirement, the:

  • PBA, PBA regulations and FSRA rules would no longer apply to any matter relating to the plan, including benefits or entitlements accrued under the plan
  • powers and duties of enforcement under the PBA, including those of the chief executive officer of FSRA, would no longer apply to the exempt plans
Updated: August 24, 2021
Published: December 19, 2019