Date: December 16, 1988
Subject: EMPLOYEES' PENSION PLANS
1. This circular replaces and cancels Information Circular 72-13R7 dated
December 31, 1981. Current revisions are designated by vertical lines.
2. The purpose of this circular is to incorporate changes made to the
administrative rules for the registration of pension plans since the
publication of IC72-13R7. This circular applies to all pension plans submitted
for registration prior to March 28, 1988, and will generally continue to apply
to benefits provided in respect of service before 1991 under defined benefit
provisions. This is intended to be the final Circular in the 72-13 series and
a permanent record of the administrative rules in effect as at March 27, 1988.
Any rules required as a result of the introduction of legislation will be
published in a new series.
3. Plans registered as at December 31, 1970, need not be amended to comply
with 9(f) and 9(g) below unless the amount or cost of pension benefits under
the plan are increased in 1971 or subsequent years. Nevertheless, for purposes
of paragraph 20(1)(s) of the Act, a special payment will not be approved to
the extent that it includes the cost of funding pension benefits in excess of
the maximum permitted by Part I of this circular.
4. The material in the circular has been divided into four parts as follows:
Part I - REGISTRATION (Paragraphs 5 to 16)
Part II - SPECIAL PAYMENTS IN RESPECT OF CURRENT OR PAST SERVICES (Paragraphs
17 to 26)
PART III - CURRENT SERVICE CONTRIBUTIONS BY EMPLOYERS (Paragraphs 27 to 35)
PART IV - OTHER PENSION PLAN MATTERS (Paragraphs 36 to 43)
PART I - REGISTRATION
(a) Registration of an employees' pension plan for a year is provided for by
subsection 248(1) of the Act.
(b) Subsection 248(1) of the Act provides for the annual registration of an
employees' pension plan. For administrative reasons, however, the Department
will usually treat the initial registration as a continuing registration. In
any case where the Department does not intend to do so, the employer will be
so advised at the time of registration. Nevertheless, the Department reserves
the right, when circumstances warrant it, to terminate registration after the
initial year of registration. This action might be taken if the plan failed to
meet registration requirements in a subsequent year or if the plan was not
operated in accordance with its written terms.
6. Nature of an Employees' Pension Plan
(a) Terms - An employees' pension plan is a definite arrangement established
as a continuing policy by an employer or group of employers or by a union in
conjunction with such employers. The terms and conditions must be set out in
(i) Its primary purpose must be to provide pensions to retired employees in
the form of life annuities. It must not be a scheme for diversion of profits
or an employees' savings fund with the right of withdrawal of funds during
(ii) It may provide for termination of the plan by the employer or for
cessation of participation by a plan member; however, it may not provide for
suspension of the plan by the employer (meaning interruption of all benefit
accruals). This does not preclude the suspension of contributions by the
employer when surplus is being applied for this purpose (See paragraph 39(a)).
Consideration will be given to requests to permit individual members to
suspend contributions to the plan or participation in the plan for a period of
time not exceeding two years. However, it is not intended that members should
have the right to suspend and renew contributions or participation at will.
For example, suspension would be permitted for members who leave employment
with the intention (of member and employer) that the member will return to
employment after a short period of time. Suspension of member contributions
would also be permitted where the plan is in part contributory and in part
non-contributory and during the period of suspension the non-contributory
benefits continue to accrue.
(iii) Defined benefit plans, (described in 6(i) below) submitted for
registration or amended after December 31, 1981 (other than multi-employer
union plans) may not contain a provision which would reduce either accrued
benefits or any right to a supplementary pension in accordance with 9(i) below
in respect of those accrued benefits. The exception to the above rule is upon
wind-up of the plan when, due to insufficient funds, a reduction in benefits
is authorized by a federal or provincial jurisdiction administering a pension
benefits act or by this Department.
(c) Persons Covered - An employees' pension plan must not provide for benefits
to be paid to persons other than employees who are members of the plan, their
beneficiaries or their estate(s).
(d) Employer Participation - The pension must be provided by the employer as
consideration for services rendered by the employee. The plan may be non-
contributory or may require members to contribute and may permit members to
make voluntary contributions (see 11 below).
(e) Funding Media - The pension plan must be funded through:
(i) a contract for insurance with a company authorized to carry on a life
insurance business in Canada,
(ii) a trust in Canada governed by a written trust agreement under which the
A. a trust company, or
B. individuals, at least three of whom reside in Canada and one of whom must
be independent to the extent that the individual is neither a significant
shareholder, partner, proprietor nor an employee of a participating employer
(see also 6(g) below),
For trusteed plans established in the Province of Quebec, evidence of a
contractual arrangement between the employer or union and persons upon whom
the arrangement imposes the duties, responsibilities and rights normally
associated with a trustee, will be accepted in lieu of a written trust
(iii) a pension corporation,
(iv) an arrangement administered by the Government of Canada or by the
government of a province of Canada, or by an agent thereof, or
(v) combinations of the above funding media.
In regard to foreign plans see 6(j) below.
Where benefits in accordance with (i) above are to be provided under
individual contracts, the contracts so issued must be held on the terms of an
express trust. Such trust must have not less than two individual trustees or a
corporate trustee. The contracts must be issued to or assigned to the trustees
who must have power to deal fully with all such contracts including assignment
or transfer of each contract to the applicable member on retirement or
termination of employment.
Where a funding vehicle of a plan is replaced and funds are being transferred
to the new vehicle, the funding contracts or agreements must provide for the
transfer and the transfer must be permitted under the plan rules. All
documents in support of the change must be submitted promptly to Revenue
Canada, Taxation for approval.
Pension benefits are to be paid by, or the pension annuity is to be purchased
by, the insurer, trustee, pension corporation or government through which the
plan is being funded. However, the insurer, trustee or pension corporation may
designate a participating employer to be its agent for the payment of benefits
upon termination of employment or death. The insurer, trustee or pension
corporation is responsible for ensuring that proper accounting of plan funds
is maintained by its agent on its behalf, and for ensuring that information
returns required by the Act or Regulations are properly filed.
(f) Segregated Fund and Deposit Administration Contracts - A contract
described as a segregated fund or deposit administration contract will be
treated as a contract for insurance if:
(i) benefits on retirement are to be provided through a life annuity contract,
(ii) benefits on retirement are to be provided by regular periodic payments
out of the fund, and
(iii) the contract prohibits the payment of amounts (other than the refund of
a certified actuarial surplus and the payment of administrative costs) by the
insurance company to a participating employer or to a person who was not an
eligible member under the plan or the beneficiary of such member.
A pension plan whose funds are invested under a segregated fund or deposit
administration contract that fails to meet the above requirements must be
funded as a trusteed plan. The contract must then be owned by the trust.
(g) Administrators - A plan funded through a trust must have a designated
administrator who is responsible for the overall operation and administration
of the plan. Such administrator may be a participating corporate employer, a
corporation resident in Canada that is in the business of rendering such
administrative services, a committee of individuals the majority of whom
reside in Canada, an insurance company authorized under the laws of Canada or
a province to carry on in Canada an annuities business or a trust company
registered under the trusts laws of Canada or a province. A corporate trustee
or pension corporation governed by the plan may also be an administrator of
the plan. An individual who is a trustee of a trust governed by the plan may
also be a member of the plan's administrative committee.
(h) Trust Accounting - The trust fund of a trusteed pension plan must have a
fiscal year ending on December 31.
(i) Type of Plan - The plan may be a defined benefit or a money purchase
arrangement or a combination thereof. A money purchase plan means a plan under
which the only benefits in respect of each member of the plan are benefits
determined solely with reference to and provided by the contributions made
under its terms by or on behalf of the member together with any earnings
reasonably attributable thereto. A defined benefit plan means a plan under
which benefits are determined in any way other than that described in the
Plans combining money purchase and defined benefit features will be considered
defined benefit plans for purposes of this circular.
(j) Consideration will be given to applications for registration of foreign
employees' pension plans that have a foreign funding medium, provided that:
(i) Canadian employers are contributing to the foreign plan but only on
account of foreign nationals employed outside Canada by the Canadian employer,
(ii) the pension benefits provided to a member under the plan are no more
beneficial than those benefits which could be provided under a registered
pension plan funded or insured in Canada.
Some deviations from the requirements of this circular may be permitted if it
is established that the plan provision is customary in the applicable country.
7. Who May Institute a Plan
(a) Any employer may institute a plan for his employees. A trade union or
trade association may institute a plan in co-operation with subscribing
employers in the industry.
(b) The employer must be a contributor. A plan under which employees alone
mutually agree to make provision of any kind for themselves or their
beneficiaries, directly or indirectly (for example, a plan permitting employee
voluntary contributions only) will not be accepted for registration as an
employees' pension plan.
(a) Coverage - The plan must state the class of employees to be covered, the
requirements to be met for eligibility and whether or not participation is
(b) Persons Excluded - In considering employees to be covered, the following
comments should be noted:
(i) "Employee" does not include a person who is self-employed.
(ii) A partner or proprietor is not an employee and cannot participate in a
registered pension plan in respect of any period when such person was not an
employee; however, participation may be permitted in respect of any prior
period of eligible service during which the partner or proprietor had been an
employee of a participating company but not a member of any pension plan in
which that company participated. Benefits must be based on actual remuneration
received in those years for such employment. Service as a partner or
proprietor in a predecessor business cannot be included in eligible service.
Such participation will not be permitted if the pension plan - or, in a multi-
employer plan, if the funding by the partnership or proprietorship - is
primarily for the benefit of the proprietor or partners and related persons.
(iii) A spouse of a partner or proprietor may be a member if such spouse is
treated as an employee for Canada Pension Plan or Quebec Pension Plan and
income tax purposes and provided that the pension plan - or, in a multi-
employer plan, the funding by the partnership or proprietorship - is not
primarily for the benefit of the proprietor or partners and related persons. A
money purchase type of pension plan which is primarily for the benefit of the
spouse of a proprietor or partner may be registered, subject to the
restrictions on significant shareholder contributions outlined in 11(a)(iii)
and 11(b)(ii) below being applied to such spouse.
(c) Personal Corporation - Service with a corporation in 1971 or prior years,
while it was a personal corporation as defined in section 68 of the Act (prior
to the December, 1971 amendments), by a shareholder of that corporation or the
spouse or child of such a shareholder, cannot be included as eligible service.
(d) Significant Shareholders - A "significant shareholder" is an individual
who, alone or in combination with a parent, spouse or child, owns or has a
beneficial interest, directly or indirectly, in shares that represent 10 per
cent or more of the voting power attached to all shares of a company that is
participating in the plan.
A plan providing defined pension benefits must not be primarily for the
benefit of significant shareholders of participating companies and/or related
persons. Furthermore, under a multi-employer defined benefit plan, the
benefits funded by a participating company must not be primarily for the
benefit of significant shareholders of that company and/or related persons.
For purposes of this circular, insofar as the term relates to a significant
shareholder, partner or proprietor, "related person" means a parent, spouse,
brother, sister or child of a significant shareholder, partner or proprietor.
A pension plan is considered to be primarily for the benefit of significant
shareholders and/or related persons if the present value of benefits purchased
for or accrued to significant shareholders and related persons is in excess of
50 per cent of the present value of the total benefits purchased for or
accrued to active members under all registered pension plans of the employer.
Consideration will be given to requests to waive this rule if it can be
determined that the corporation is not controlled by those plan members who
are significant shareholders and/or related persons. Consideration will also
be given to requests for waiver of this rule where the plan is a multi-
employer plan and the significant shareholders and/or related persons are
obliged to contribute to or be members of the plan as a condition of union
membership that is a prerequisite to employment.
Nevertheless, defined benefit plans primarily for the benefit of significant
shareholders and/or related persons which were registered as such prior to
October 1, 1968 or which were implemented during 1980 will not be terminated
solely as a result of the fact that they are primarily for the benefit of
significant shareholders and/or related persons. However, such plans may not
be amended to increase the amount or cost of benefits to significant
shareholders and/or related persons except that 1980 shareholder plans may be
amended to allow a normal retirement age of no earlier than age 60.
The Supplementary Rules Regarding Shareholder Pension Plans which were
released on December 29, 1980, are not incorporated into this circular but
continue to apply to plans implemented in 1980 primarily for the benefit of
controlling shareholders and related persons. However, as of December 5, 1985,
some of the Supplementary Rules were relaxed to permit plans to be amended as
(i) Normal retirement age may be as early as age 60. Any resulting unfunded
liability is considered to be an initial unfunded liability.
(ii) Benefits on retirement may be paid directly from the fund.
(iii) The commuted value of the accrued pension entitlement may be transferred
to a locked-in registered retirement savings plan on retirement, termination
of employment prior to retirement and upon termination of the plan.
(iv) With regard to actuarial assumptions for funding or long term assumptions
for funding cost-of-living adjustments, any assumed rate of return which is
reasonable and consistent with those used for regular employees' pension plans
will be accepted.
(v) The minimum amortization schedules initially imposed have been relaxed to
permit an amortization schedule as certified by the plan actuary.
Plans registered under the 1980 Shareholders Rules may not be amended to add
participating employers or significant shareholder members or related persons
who were not in the original plan.
(e) Eligible Service
(i) Eligible service must be service with an employer carrying on all or part
of its business in Canada or otherwise operating in Canada and such employer
must be a contributing employer under the plan or a proprietorship,
partnership or corporation that was its predecessor. Such service must be
service in Canada or service outside Canada directly related to the earning by
the employer of income that is taxable in Canada or would be taxable except
for an exempting provision of the Act or a Convention. Such service is subject
to the restrictions imposed by 8(b) and (c) above.
(ii) An exception to this rule will be permitted where a participating
employer has a reciprocal agreement with another Canadian employer, or with a
foreign employer that is an associated or affiliated company, to accept prior
service with that other employer as eligible service under the participating
employer's pension plan. Such reciprocity may be effected through a written
agreement to which each participating employer is a party or by incorporation
of equivalent clauses into the pension plan of each such employer. A
conditional requirement would be that the member had been a member of the
other employer's pension plan or had been in employment counting towards
eligibility for membership in the other employer's pension plan.
(iii) Consideration will also be given to the inclusion in eligible service of
other relatively short periods of service (three years or less), inside or
outside Canada with an employer that is associated or affiliated with a
(iv) Periods of paid leave and periods of sabbatical leave, educational leave,
and maternity, paternity or adoption leave (paid or unpaid) may be counted as
Periods of active service in the Canadian Armed Forces or periods of active
service with allied forces during World War II or the Korean war may also be
Periods of leave due to total disability, as certified by a medical
practitioner, may also be included in eligible service. For purposes of final
or career earnings arrangements, earnings during such periods may be deemed to
A. at a per annum rate that is not in excess of the sum of the remuneration
paid for the twelve months immediately prior to the total disability leave and
increments warranted by increases in the Consumer Price Index or Average
Industrial Wage, or
B. the amount of benefits paid to the member under a sickness and accident
insurance plan, including any amount under such plan indexing benefits to
increases in the Consumer Price Index or Average Industrial Wage.
(v) Subject to a three-year limitation, eligible service may include periods,
with or without pay, of short-term appointment to federal or provincial
governments, committees or commissions or loan to a union, educational
institution or charitable organization where benefits do not accrue for such
service under another pension plan.
Other periods of unpaid leave (including lay off) not exceeding two years may
be included in eligible service.
(vi) Portability arrangements that include in eligible service all or part of
periods of eligible service under a prior registered pension plan will be
accepted, provided that:
A. the funds associated with the accrued entitlement under the prior plan are
transferred to the current plan, and
B. such periods of eligible service were pensionable service under the prior
plan and pursuant to the arrangement, are to be pensionable service under the
Such portability arrangements must provide to terminating members rights that
are equivalent to those provided under the arrangement to new members.
(vii) A. Where a controlling shareholder becomes, after December 31, 1980, a
member of a plan which provides for the accrual of a past service benefit, the
plan must specifically exclude from the eligible service of such a member
periods during which that member was a significant shareholder or a related
person to whom a benefit accrued under a deferred profit sharing plan or
another registered pension plan of the participating company or a related
company. A controlling shareholder is a significant shareholder or related
person who directly or indirectly or in conjunction with other members who are
significant shareholders and persons related to them, controls the
B. The above restriction does not apply if the controlling shareholder is
obliged to be a member of the pension plan as a condition of union membership
that is a prerequisite to employment and such shareholder or related person is
subject to the same rights and conditions as all other members.
C. Plans established prior to January 1, 1981, which included such service in
eligible service of a member to whom the restriction applies, may continue to
do so but may not increase benefits payable to the member on account of such
service or accept from the member further additional voluntary contributions
on account of such past service.
D. For 1981 and subsequent years, service under a defined benefit plan will
not qualify as eligible service, insofar as it pertains to a controlling
shareholder, if remuneration paid to that member for the year is not
reasonable in the circumstances. Remuneration of such a person will be
considered to be reasonable if it is at least the lesser of $65,000 or 75 per
cent of the average of the remuneration paid to the member for the prior best
three consecutive years.
(a) Formula - The amount of the pension benefits to be provided, if not on a
money purchase basis, must be in accordance with a definite formula set forth
in the plan.
(b) Life Annuity - Settlement on retirement (which includes any termination of
employment after the earliest age at which a pension may become payable under
the plan without adjustment by reason of early retirement, as well as
retirement for disability and retirement pursuant to 10(a)(iii) below) must be
in the form of an annuity payable in equal periodic amounts at least for life
(i) the annuity in the normal form at retirement age would be no greater than
4 per cent of the Year's Maximum Pensionable Earnings as defined by section 17
of the Canada Pension Plan.
(ii) the member establishes, by a statement from a qualified medical
practitioner, that he has only a short life expectancy (that is, a life
expectancy materially shorter than shown on the Extracts from Canadian Life
Table attached as Appendix A, or a successor table published by Statistics
(iii) the portion of the benefits paid other than by a life annuity is settled
by a single payment and is derived solely from additional voluntary
(iv) the annuity is in part on account of supplementary pension benefits
described in 9(i) below, in which event the annuity may be increased or
decreased to reflect changes in the amount of the supplementary pension;
(v) the annuity is integrated with benefits payable under the Canada Pension
Plan, Quebec Pension Plan or Old Age Security Act to provide a level combined
benefit from all sources after retirement. The commuted value at retirement of
the portion of the benefits funded under the registered pension plan must not
exceed the commuted value at retirement of the maximum pension permitted under
9(g) or 9(g.1) below;
(vi) the basic pension is supplemented by a bridging benefit for all or part
of the period of retirement prior to age 65 and such bridging supplement is
reasonable in the circumstances and in relation to maximum social security
benefits (OAS and CPP or QPP) payable to persons over age 65;
(vii) benefits under a money purchase plan are being paid as a variable or
escalating annuity for life;
(viii) under a member option provision, the value of defined benefits accrued
to date of retirement that would otherwise be paid as a life annuity is
converted at date of retirement to a variable or escalating annuity for life
or the value of the remaining life annuity at a date subsequent to retirement
is similarly converted; or
(ix) part of the member's own contributions and interest thereon is paid to
the member pursuant to a provision in a federal or provincial pension benefits
Furthermore, consideration will be given to a provision for a partial
settlement in the form of a variable or escalating annuity, in other
circumstances, when it is established that the cost or present value of the
total pension payable to a member will not exceed the cost or total value of
the maximum pension that may be paid to that member within the limitations of
9(g) or 9(g.1) below.
The value of the pension benefit may be paid as a joint and last survivor
annuity under which the amount paid to the survivor is equal to or less than
the amount paid under that annuity to the member.
A further option allows for the transfer of the commuted value of the accrued
pension entitlement on retirement to a locked-in registered retirement savings
plan (meaning a registered retirement savings plan which does not provide for
a payment to the annuitant except by way of life annuity).
(c) Commutation - Commutation otherwise than provided in 9(b) above may occur
only on or after death, termination of employment or termination of the plan
prior to the retirement of the member. Commutation may not occur when
employment is terminating due to retirement, nor, where participation in the
plan is compulsory, may it occur when termination is known by the
administrator or trustee to be for the purpose of taking eligible employment
with another employer participating under the plan. Further, commutation may
not occur on account of voluntary termination of plan membership or due to
transfer to employment (with the same employer) which is ineligible under the
plan. The commutation of accrued pension benefits attributable to a member's
spouse as a result of a marriage breakdown is permitted, provided it is
pursuant to a written agreement, decree, order or judgment of a competent
tribunal. Cash settlement while continuing in employment will be denied except
on or after termination of the plan, when a short life expectancy has been
established as per 9(b)(ii) above or when contributions on behalf of the
member have been discontinued and the equity would purchase at normal
retirement age, a life annuity in the normal form of no greater than 4 per
cent of the Year's Maximum Pensionable Earnings (as defined by section 17 of
the Canada Pension Plan) per annum. However, cash settlements by direct roll-
over to registered retirement savings plans, while continuing in employment,
will be permitted to the extent and in the circumstances described below;
(i) a roll-over of members' voluntary pension contributions on a once-and-for-
all basis following an amendment to the plan to deny members the right to make
voluntary contributions, or
(ii) a roll-over of members' required contributions on a once-and-for-all
basis following an amendment to the plan to delete a requirement for
contributions by members, without any reduction in accrued benefits, and to
provide for the employer to bear the full cost of benefits under the plan.
The Canadian Institute of Actuaries' minimum transfer value recommendation is
an acceptable method of calculating the value of benefits (including bridging
benefits and supplementary pensions) commuted pursuant to the provisions of
this paragraph and paragraphs 9(b) and (l). Any other actuarial method used to
calculate commuted amounts is subject to approval by the Department. Such
commutations are also subject to the limitations of the Pension Benefits
Standards Act, 1985 or provincial pension benefits legislation, if applicable.
(d) Deleted (see 8(e)(iv) and 10(c)(ii))
(e) Death Benefits - The plan may provide a benefit on account of the member's
death before retirement which is reasonable in relation to the service of the
member and in relation to the plan's benefit formula. The commuted value of
the death benefit may not exceed the accrued entitlement of the member except
where a provision to refund to the beneficiary or estate the member's
contributions plus interest, or, in a money purchase plan, the member's and
employer's contributions plus interest, results in a refund in excess of the
Nevertheless, a defined benefit plan may provide for a minimum death benefit,
so long as it is reasonable in the circumstances. Examples of minimum death
benefits which would be considered reasonable are: i) after a specified period
of service, a lump sum payment of 50 per cent of the member's remuneration for
the last twelve months of employment, and ii) a lump sum payment of $2,500
regardless of the remuneration level of the deceased.
Death benefits after retirement, other than a return of the deceased member's
contributions not used to provide pension benefits, plus interest, will not be
The benefit payable to the beneficiary or estate upon the death of the member,
either before or after retirement, may be (in whole or in part) by lump sum,
by an immediate annuity for life or by a deferred annuity for life commencing
before the beneficiary attains age 65. Such annuity may be guaranteed in
accordance with 10(d) below. The beneficiary or estate may also receive the
benefit in the form of immediate instalments or an annuity certain commencing
immediately. The instalments or annuity certain must not exceed a period of
ten years from the date of death. The treatment to be accorded a guaranteed
annuity in the event of death after retirement is also explained in 10(d)
below. (Such death benefits, whether paid in a lump sum or not, are
superannuation or pension benefits as defined by subsection 248(1) of the Act
and must be reported as such on information and tax returns.)
(f) Dependants' Pension Benefits - A pension plan may provide for a reasonable
pension to a spouse (including common-law) or to a parent, brother, sister or
child provided that such persons were dependent on the member at the time of
the member's death. The amount of the pension must be directly related to (but
must not exceed) the accrued entitlement of the member at date of death except
that a reasonable and moderate minimum pension may be provided, subject to a
specified period of eligible service. As an example, a pension to a spouse of
60 per cent of the amount of pension accrued to the member at date of death
would usually be considered to be a reasonable pension.
(g) Maximum pension
(i) Plans that are funded on a money purchase basis (except those terminally
funded) and under which benefits are payable solely on a money purchase basis
are not subject to these maximum pension rules. Plans providing pension
benefits on a defined benefit basis or under a combination of a defined
benefit and a money purchase benefit and plans terminally funded must
specifically prohibit pension benefits out of or under the plan, paid in the
normal form specified under the plan rules, from exceeding an amount that
would be at an annual rate that is the lesser of:
A. $1,715 times the number of years of pensionable service not exceeding 35,
B. the amount that is the product of
(I) 2 per cent per year of pensionable service not exceeding 35 years, and
(II) the average of the best three consecutive years of remuneration paid to
the member by the employer;
or, if paid in an optional form, from exceeding the actuarial equivalent of
the amount that would otherwise be determined under the above formula. Where
benefits are paid in a form which has a lower actuarial equivalent than the
normal form under the plan, the restrictions set out in A & B above must be
respected. The above rule applies to all pension benefits, including any
distribution of surplus to members and any amount paid out to the member's
spouse as a result of marriage breakdown, whether payable upon retirement,
termination of employment or termination of plan.
This rule will not apply to an annual pension of $300 or less per year of
pensionable service nor will it apply to the portion, if any, of the pension
derived from a member's additional voluntary contributions (either for current
or past service) provided that the portion of the pension so derived is
determined on a money purchase basis.
Where a plan provides defined benefits for a specified period of past services
and benefits on a money purchase basis for subsequent periods, the maximum
pension rule need not apply to members whose only pension entitlement is to
benefits determined under such money purchase basis.
(ii) Where a bridging benefit is payable, where benefits are integrated with
the CPP/QPP, OAS or both and where benefits are payable under an escalating
annuity, the pension benefits payable under the plan may not exceed the
commuted value of the maximum pension permitted under the above formulae,
unless the basic pension after age 65 is $300 or less per year of service or
amounts that are the equivalent value of such a pension. Where a bridging
benefit is payable any excess bridging benefit must be included in the
calculation of the commuted value. For this purpose an excess bridging benefit
is that portion of a bridging benefit payable up to age 65 that is in excess
of the sum of the basic Old Age Security Pension and the maximum CPP/QPP
retirement pension payable at the time of determination and all of a bridging
benefit payable after age 65.
(iii) For the purpose of (B)II above, a maximum pension limitation using the
best five years of remuneration rather than the best three consecutive years
of remuneration will be accepted even though, for some members, it may produce
higher benefits (subject to the limitations of (A)) than would otherwise be
permitted. A benefit expressed as the greater of the two will not be accepted.
(iv) If the plan so provides, dividends from participating policies of insured
plans may be applied to purchase an additional pension provided that the total
pension does not exceed the maximum pension set out above; otherwise,
dividends must be applied to reduce the employer's contributions.
(v) It is not intended that the above limitations should reduce a member's
pension below that pension which could be purchased by an amount equal to the
member's own contributions plus a reasonable rate of interest thereon.
(vi) If a member will receive or has received benefits under more than one
registered pension plan or previously registered pension plan of an employer
or group of employers, the above limitations apply to the combined benefits
paid or payable to the member or on the member's behalf under such plans.
(vii) A defined benefit plan may increase the basic pension payable to retired
members subject to the maximum pension rule stated above.
(g.1) Maximum Pension - Special Situation
Plans providing for benefits to be paid on the basis of the greater of a
defined benefit and a benefit determined on a money purchase basis are subject
to the following rules:
(i) The defined benefit must not exceed the limitations set out above,
(ii) Subject to (iii) below, the money purchase benefits must not exceed the
A. the benefits that could be purchased by an amount that is twice the amount
of the required current service contributions made by the member (not
exceeding $2,500 in any year up to and including 1975 and the amount
deductible by the member as a current service contribution in any subsequent
year) plus a reasonable rate of earnings thereon, and
B. the benefits that could be purchased by the sum of the required current
service contributions made by the member and the current service contributions
made by the employer on behalf of the member (the latter not exceeding $2,500
in any year up to and including 1975 or the amount deductible by the employer
as a current service contribution on behalf of the member in any subsequent
year), plus a reasonable rate of earnings thereon, and
(iii) Members' additional voluntary contributions (on account of past and
current service) plus earnings thereon may be applied to provide benefits in
addition to those permitted under (i) or (ii) above.
(g.2) Definitions for purposes of 9(g):
(i) A normal form of pension is a pension based on either a single life with
or without an acceptable guarantee period or a joint and last survivor not
exceeding 60 per cent to the survivor.
(ii) Pensionable service is eligible service as defined in 8(e) above for
which a pension is being provided, at least in part at some reasonable cost to
the employer or a former employer in regard to each year of service, plus
eligible service as defined in 8(e)(iii), (iv) or (v) above for which a
pension is being provided solely at the member's expense. It also includes a
year of deemed service in accordance with 10(c)(ii) below or pursuant to a
provision, in accordance with 10(a)(iii) below, that has been accepted by the
(iii) For purposes of these maximum pension rules a year is normally a twelve
month period and total pensionable service is to be calculated to a fraction
of a year.
(h) Minimum Pension - Notwithstanding the general limitation of 9(g) above,
the plan may provide a moderate minimum pension benefit (not related to
earnings or service) which, taking into account Old Age Security and Canada
Pension Plan or Quebec Pension Plan benefits, is reasonable in the
circumstances. For example, a minimum pension benefit under the plan of $250
per month at normal retirement age, after 10 years of eligible service, would
be considered to be a reasonable minimum pension.
(i) Supplementary Pension Benefits
A defined benefit plan may include a provision for a supplementary pension, in
recognition of increases in the cost of living after retirement or termination
Supplementary pensions may be adjusted on a quarterly or less frequent basis.
Where supplementary pensions are based on the excess earnings approach, the
plan must specify the base rate, the formula for determining the earnings rate
and a reasonable allocation. The earnings rate may be related to the
investment earnings of the fund or to some external index.
Such a supplementary pension is not restricted by the maximum pension rule in
9(g) above, provided that i) it is warranted by increases in the Consumer
Price Index and ii) it does not become payable to a member before the later of
the date the member attains age 60 and the date of retirement or termination
of the member (except where retirement is on account of disability or pursuant
to 10(a)(iii) below).
Where a plan permits a supplementary pension to accrue to a member prior to
age 60 as a result of retirement or termination of employment before age 60,
the benefit payable at age 60, including the accrued supplement, must be
limited in the plan to the maximum pension (9(g) above).
Plans that were registered for purposes of the Act on January 21, 1980, and
provided for the payment of supplementary pension benefits after retirement or
termination at an age earlier than 60 may continue to do so. Such plans must
prohibit the total of the pension benefits and supplementary pension benefits
payable at age 60 or earlier from exceeding an annual rate of $1,715 times the
number of years of pensionable service, not exceeding 35. After age 60 these
total pension benefits may be increased by such additional supplementary
benefits as are warranted thereafter. This restriction on the amount of
supplementary pension benefits payable at age 60 or earlier does not apply to
the payment of such benefits to a member's beneficiary.
Where pension benefits at lower maximum pension levels formerly permitted were
increased effective September 1, 1976, to the higher maximum under 9(g) above
and supplementary pension benefits are payable under the plan, such
supplementary pension benefits may only be based on increases in the Consumer
Price Index after September 1, 1976. However, if the sum of the pension
benefits under the former maximum pension limitations and the supplementary
pension benefits under this paragraph, as at August 31, 1976, is greater than
the pension benefits payable under 9(g) above as at September 1, 1976, then
pension benefits and supplementary pension benefits may continue to be paid
and indexed under the former provisions.
Money purchase pension plans may use the excess earnings approach to provide
pensions with a variable escalation.
(j) Settlements - On or after termination of employment prior to retirement or
on or after termination of the plan, benefits may be paid to the member in a
lump sum, by instalments or annuity certain commencing no later than the
earliest date from which a pension may be payable under the plan or as an
annuity for life maturing before the member attains age 71, or any combination
thereof. The instalments and annuity certain may not exceed a period of ten
years from the date they commence. The commuted value of the benefits may also
be transferred to another registered pension plan or to a registered
retirement savings plan. The value of the benefits so paid may not exceed the
value of the maximum pension permitted under 9(g) or 9(g.1) above, as
(k) Remuneration - For purposes of this circular "remuneration" may include
all salary, wages, bonuses, vacation pay, honoraria, directors' fees,
commissions, taxable allowances, the value of taxable benefits and any other
payments actually received by the member during the year for services during
the year as an officer or employee of a participating employer that are
reasonable in the circumstances.
(l) Conversions - When a defined benefit plan is converted to a money purchase
plan, a valuation report using transfer values which reflect the member's
accrued entitlement under the defined benefit plan must be submitted to
Revenue Canada, Taxation, addressed as specified in 14(a) below. The defined
benefit may be increased prior to conversion to the maximum pension specified
in paragraph 9(g) above.
Any actuarial surplus which is not refunded to contributing employers after
the conversion may remain in the plan to fund employer future service costs,
provided that the money purchase plan text contains a provision permitting any
surplus remaining upon termination of the plan to be refunded to contributing
employers. Unless the surplus is allocated to a separate employer account to
be used for the sole purpose of funding such future service costs, the plan
text must also include the maximum pension rule applicable to those members
who have accrued a benefit under the defined benefit portion. The combined
defined benefit and money purchase pension accrual will then be limited by the
maximum pension rule.
10. Retirement Age and Guarantee Periods
(a) Normal Retirement Age
(i) Normal retirement age for purposes of the plan should be defined and
should not be before the first day of the month in which the member's 60
birthday occurs nor later than the day preceding the member's 71 birthday;
however, when the plan is insured and retirement is based on the plan
anniversary date, normal retirement age may be up to 183 days prior to the 60
birthday. A normal retirement age later than age 71 will be accepted only in
regard to a specific individual when that person is retiring immediately after
being brought into the plan.
Retirement must constitute a factual termination of employment; however, after
a member's 65 birthday the member may be deemed to have retired for purposes
of the plan and the member may receive a whole or partial pension, even though
remaining in employment.
The payment of a whole or partial pension may commence prior to age 65 while
the member remains in employment with a participating employer under the plan,
if the member has reached normal retirement age under the plan and
A. the pension payment is compensating for a reduction in earnings or
B. further deferral would result in the basic pension exceeding the limitation
stated in paragraph 9(g) above.
No further benefits, including additional voluntary contributions, may accrue
to a member who remains in employment or returns to employment with such an
employer after a break in service while in receipt of a whole or partial
(ii) Normal retirement age may be earlier than age 60 if such retirement is
dependent on the completion of 30 years of service under the plan or if such
retirement is dependent on the sum of retirement age plus years of service
totaling 80 or more.
(iii) Consideration will be given to the inclusion of a clause to provide a
reduced normal retirement age, in individual cases at the discretion of the
employer, when retirement is being imposed on members who are long-term
employees, because of automation or failure of members to keep their knowledge
in pace with advancement in technology. The provision may involve the payment
of pensions at an earlier date without actuarial reduction and may also
involve an additional credit of deemed years of service representing all or
part of the period between actual retirement age and the normal retirement age
otherwise specified in the plan. Such a provision must be reasonable in the
(b) Deferred Retirement - Plans may allow the payment of pension benefits to
be deferred on an optional basis up to the day preceding the individual's 71st
birthday. A member may continue in employment beyond age 71 while in receipt
of pension benefits. Should the payment of pension benefits be deferred beyond
age 71, the amount of the periodic instalments that would otherwise have been
paid from age 71 to actual commencement of pension may not be deferred or used
to increase benefits paid after retirement.
Service after the 71 birthday may count for eligibility for coverage but
additional benefits cannot accrue for such service.
(c)i) Early Retirement (Other than for disability) - There may be provision
for voluntary retirement prior to normal retirement age but in that event, the
present value of the pension (including excess bridging benefits as referred
to in 9(g)(ii) above) payable to a member at actual retirement may not exceed
the limitation set out in 21 below.
(ii) Early Retirement (Disability) - Unreduced early retirement pensions due
to total and permanent disability which is certified as such by a medical
practitioner (disability pensions) may be provided under a plan.
The pension paid may be based on actual service plus the period of disability
up to the normal retirement age specified in the plan.
A lesser disability pension, such as is reasonable in the circumstances, may
be paid where disability is such as to permit employment, but only at lesser
levels of remuneration. Normally, the sum of the remuneration and the
disability pension should not exceed the total disability pension that would
have been payable had the individual been totally disabled.
A member in receipt of a disability pension is considered to have retired for
purposes of the pension plan.
(d) Guarantee Period - The maximum acceptable guarantee period for both
regular and optional life annuities to a member is the lesser of:
(i) fifteen years, and
(ii) the period from the date of retirement of the individual to the day
before the date on which the individual's 86th birthday would occur.
In the event of death of the annuitant prior to the expiry of the guarantee
period, the annuity contract may provide either for commutation of the
benefits for the balance of the guarantee period for payment to the estate or
to a designated beneficiary, or for the remainder of the annuity payments to
be made to a designated beneficiary.
In the case of a joint and last survivor annuity, there can be no guarantee of
payments on the death of the second life other than for the unexpired term of
the guarantee on the first life.
Where, upon the death of a member, a benefit becomes payable to a beneficiary
in the form of a life annuity (other than as the last survivor under a joint
and last survivor annuity), the maximum acceptable guarantee period is the
(iii) fifteen years, and
(iv) the period from the date of death of the member to the day before the
date on which the beneficiary's 86th birthday would occur.
(a) Required Contributions
(i) Unless the plan requires terminal funding it must contain an obligation
for future service contributions by the employer. It may also contain an
obligation for future or past service contributions by members.
(ii) If the plan is a money purchase plan the formula for contributions, which
must be set out in the plan, must provide for an employer contribution in each
year of at least 1 per cent of the remuneration of participating employees for
that year. Contributions must be limited by the plan to amounts deductible
under the provisions of paragraphs 20(1)(q) and 8(1)(m) of the Income Tax Act.
(iii) Unless 11(e) below applies, a money purchase plan that is primarily for
the benefit of significant shareholders or related persons must restrict an
employer's contributions on account of such a member to the lesser of
A. $3,500, and
B. 20 per cent of the remuneration paid to such member by the employer in the
year, and must restrict the annual contributions of such a member to the
C. $3,500, and
D. 20 per cent of the earned income of such member for the year.
Where related companies participate in one or more pension plans which are
primarily for the benefit of significant shareholders or related persons, or
where each such company's participation in the plan is primarily for the
benefit of significant shareholders or related persons, the combined
contributions on behalf of such persons may not exceed the limits set out
above, based on the combined remuneration paid by the related companies.
(i) Subject to the limitations of (ii) below, additional voluntary
contributions to a plan on account of current and past service may be
permitted in respect of service that is eligible service as defined in 8(e)
above, to the extent that such contributions are deductible under paragraph
8(1)(m) of the Act. If, pursuant to a reciprocal agreement or portability
arrangement, eligible service includes service that was eligible service under
a prior registered pension plan, the plan must restrict additional voluntary
contributions to amounts that would be deductible under paragraph 8(1)(m) of
the Act if such service had been service with the current employer and
contributions made under a prior plan in respect of such service had been
contributions under the current plan.
(ii) Unless (e) below applies, a plan that is primarily for the benefit of
significant shareholders or related persons must deny to such persons the
right to make additional voluntary contributions on account of past service.
(iii) In the event of a transfer from one pension plan to another of funds
derived from additional voluntary contributions, the funds will retain the
status of additional voluntary contributions unless they are applied by the
member to pay contributions that are required under the new pension plan.
(iv) Where a member elects to purchase past service benefits and in doing so
becomes obligated to satisfy a determinable indebtedness (normally, where
benefits are defined), the contributions on account of such indebtedness are
required contributions, not additional voluntary contributions.
(c) Special Payments - Special payments by employers on account of past
service (including terminal funding) must be approved by the Minister pursuant
to paragraph 20(1)(s) of the Act. If any portion of current service
contributions are not deductible under paragraph 20(1)(q), approval of the
total current service contributions for the year may be sought under paragraph
20(1)(s). The requirements that must be met to secure such approval are
contained in Part II of this circular.
(d) Partners and Proprietors - Subject to the limitations contained in
8(b)(ii) above, a partner or proprietor may contribute to a plan on account of
past service as an employee (see 8(b)(ii) above) to the extent that such
amounts are deductible under subparagraph 8(1)(m)(ii) of the Act.
(e) The restrictions in (a)(iii) and (b)(ii) above may be waived by the
Department if the corporation is not controlled by the members who are
significant shareholders or related persons. A waiver may also be granted
where significant shareholders or related persons are obliged to be members of
a multi-employer plan as a condition of union membership that is a
prerequisite to employment.
12. Assignments and Loans
(a) No right or interest of a plan member, including those resulting from
employee voluntary contributions, may be capable of assignment or alienation
except as specifically required or permitted under the Income Tax Act, Pension
Benefits Standards Act, 1985, or a provincial pension benefits act or, in the
event of a splitting of accrued pension benefits on or after the breakdown of
a marriage, pursuant to a decree, order or judgment of a competent tribunal or
in accordance with a written separation agreement relating to a division of
property between the member and the member's spouse or former spouse in
settlement of rights arising out of their marriage.
(b) The plan may not provide loan privileges. Nevertheless, it is not intended
that trustees should be prohibited from investing in mortgages under which a
plan member is the mortgagor, provided that the mortgage bears a reasonable
rate of interest and such investments are made within the limitations set for
such investments in the Pension Benefits Standards Act, 1985, or a provincial
pension benefits act or regulations there under.
(c) Trustees are not to be given power to borrow moneys, except occasionally
on a short-term basis to
(i) provide funds for the current payment of benefits or purchase of annuities
without resort to a distress sale of assets of the fund, or
(ii) make additional investments, provided that the assets of the fund are not
pledged as security against the loan and the total indebtedness of the pension
fund in respect of such borrowing does not exceed at any time the sum of the
required current service contributions to and reasonable earnings of the fund
in the immediately subsequent twelve month period.
Note: Item (ii) above may not be acceptable to some jurisdictions
administering a pension benefits act.
(a) Unless a trusteed plan is registered under either The Pension Benefits Act
of the Province of Ontario, The Employment Pension Plans Act of the Province
of Alberta, The Pension Benefits Act of the Province of Saskatchewan, The
Pension Benefits Act of Manitoba, The Pension Benefits Act of Nova Scotia, The
Supplemental Pension Plans Act of Quebec, the Pension Benefits Act of
Newfoundland, an act of another province that similarly controls plan
investments or the federal Pension Benefits Standards Act, 1985, the plan must
contain a requirement that all investments and re-investments will conform to
the investment requirements of section 9 of the Pension Benefits Standards
Act, 1985 and section 6 and Schedule III of the Pension Benefits Standards
(b) Failure to comply with the above investment requirements at the time of
application for registration or subsequent thereto will result in denial or
termination of registration, as applicable.
13.1 Use of Surplus
(a) A plan must not provide for a surplus on wind-up of the plan, or at any
other time, to be payable to an employees' welfare fund or to any fund except
the fund of another registered employees' pension plan and then subject to the
advance approval of such payment by Revenue Canada, Taxation.
A request for permission to effect such a transfer should be directed to:
Registered Pension and Deferred
Income Plans Division
Revenue Canada, Taxation
The request should be accompanied by a current actuarial report and
certificate, prepared in accordance with generally accepted actuarial
principles, presenting the funded status of each plan participating in the
transfer transaction, such resolutions and plan amendments as may be required
and evidence of approval by a provincial or federal jurisdiction, if
b) A defined benefit plan may not permit the distribution to a member, upon
termination of the plan or at any other time, of any portion of a surplus in
the fund that would result in benefits to the member being in excess of the
maximum permitted under 9(g) or 9(g.1) above, as applicable. Therefore, the
plan must contain a provision permitting an actuarial surplus to be refunded
to contributing employers upon termination of the plan (Also see 39 below).
14. Application for Registration
(a) Method and Documentation - Send one copy of completed form T510
(Application for Registration of Employees' Pension Plan), together with a
copy of any applicable insurance contract, plan text or trust agreement, such
pertinent by-laws or resolutions as may exist and any other material documents
Registered Pension and Deferred
Income Plans Division
Revenue Canada, Taxation
Copies of Form T510 may be obtained from any Revenue Canada, Taxation District
(b) Registration under Other Jurisdiction - If the pension plan is subject to
registration under the Federal Pension Benefits Standards Act, 1985, The
Pension Benefits Act of Ontario, The Employment Pension Plans Act of Alberta,
The Pension Benefits Act of Saskatchewan, The Pension Benefits Act of
Manitoba, The Pension Benefits Act of Nova Scotia, The Pension Benefits Act of
Newfoundland or similar legislation of any other province, the registration
number under the Act is to be submitted with the T510 application or as soon
thereafter as it becomes available.
If the pension plan is subject to registration under the Supplemental Pension
Plans Act of Quebec, a copy of the certificate of registration under the act
or of the letter that accompanied the certificate is to be submitted with the
T510 application or as soon thereafter as it becomes available.
When a plan is subject to registration under one of the above-named Acts,
registration under subsection 248(1) of the Act will not be effected until the
above-mentioned evidence of registration is submitted.
(c) Specimen Plans -
(i) In order to simplify and expedite the registration process, standardized
components of plan documentation (specimens) may be submitted to the address
shown in (a) above for approval in principle. Specimens may consist of either
the entire standardized plan including the plan provisions and funding
contract, or separate plan components. Certain variables, such as contribution
rates, vesting schedules and retirement age, are permitted but these must be
specifically identified as such in the specimen.
A specimen plan number is issued when the specimen has been approved in
(ii) Where a plan conforms to an approved specimen plan, the application for
registration will consist of the completed T510 application form, a
description of the actual terms provided under the permitted variables, if
any, and any other required documentation not included in the specimen.
(iii) If a plan that conformed to a specimen plan at the time of application
is subsequently amended so that it no longer conforms, complete plan
documentation must be submitted to the address shown in (a) above.
15. Amendments or Revisions
(a) All amendments or revisions to the insurance contract, plan text or trust
agreement, including those provided under the permitted variables of a plan
conforming to a specimen, must be submitted promptly to Revenue Canada,
Taxation, as specified in 14(a) above. The submission should identify the
nature of the changes.
(b) Such submissions may not be acknowledged and confirmation of their
acceptability and continuation of registered status may not be given.
Exceptions will be made where there is an extensive revision to or replacement
of a plan, where acceptance is conditional or where approval of a special
payment on account of past service is sought in conjunction with the
amendment. Correspondence will ensue in regard to unacceptable or questionable
(c) A registered pension plan that is amended or revised retains its
registered status unless advice of termination of registration is given to the
participating employer(s), or union or agent thereof.
16. Termination of Plan
If an employer terminates a registered pension plan, terminates his
participation in such a plan or places such a plan on a paid-up basis, Revenue
Canada, Taxation must be so advised. Prior approval of this Department is not
required. For defined benefit plans, the Department must be advised of the
current position of the plan fund and a wind-up actuarial valuation report,
prepared in accordance with generally accepted actuarial principles must be
submitted. If a trust fund is wound-up for any reason, the Department should
be informed of that fact and of the application of all funds, including the
purchase of deferred annuities, and whether such annuities were purchased in
accordance with paragraph (a) or (b) of section 254 of the Act.
PART II - SPECIAL PAYMENTS IN RESPECT OF CURRENT OR PAST SERVICE
(a) Paragraph 20(1)(s) of the Act permits the deduction of special payments by
an employer on account of an employees' superannuation or pension fund in
respect of current or past services of members if the payment is approved by
the Minister of National Revenue on the advice of the Office of the
Superintendent of Financial Institutions (formerly the Superintendent of
Insurance). Section 67 of the Act states that in computing income no deduction
shall be made in respect of an outlay or expense otherwise deductible except
to the extent that the outlay or expense was reasonable. Special payments will
be approved only within the limitations set out in the succeeding paragraphs
of this part and only in regard to registered plans.
(b) It should be noted that special payments must be irrevocably vested in or
for the fund or plan except that there should be a provision permitting a
refund of an actuarial surplus to the contributing employer (See 13.1(b)
(c) An application for approval under paragraph 20(1)(s) of special payments
on account of current service must cover all employer payments to any one plan
in the year on account of service of its employees in the year. The
application cannot be restricted to payments on behalf of employees for whom
current service contributions exceed $3,500 for the year.
(d) "Actuary" means a Fellow of the Canadian Institute of Actuaries (For
foreign plans, submissions by other actuaries may be accepted).
18. Defined Benefits
(a) If current or past service is to be funded as provided by paragraph
20(1)(s) of the Act, there must be defined and precisely stated benefits for
the period for which benefits are being so funded. The special payment must be
one to ensure that the obligations of the fund or plan to the employees may be
discharged. This means that there must be a defined benefit provision in the
plan and an obligation upon the employer to fund those benefits. An obligation
of an employer to make contributions for services on a money purchase basis
does not meet the requirements of this part.
(b) Except where an employee has retired or is about to be retired or
employment is to cease, a plan will not be approved where it only provides for
pensions on account of past service, without any future service contributions.
It is not reasonable to provide a pension based solely on past service when
the service is not terminating at that time.
19. Proportionate Benefits
(a) If a plan provides defined benefits for both past and future service, the
portion of the pension referable to past service normally must not be greater
than the proportion thereof that the number of years of past service is of the
(i) the total number of years of past service and potential future service to
normal retirement age, and
(ii) the total number of years of past service and potential future service
until a total pension of 70 per cent is accrued, e.g., 35 years for 2 per cent
per annum accrual or 40 years for 1 and three quarters per cent per annum
For purposes of this rule, members' voluntary contributions on account of past
and future service to provide additional benefits need not be considered in
determining the pension.
(b) Notwithstanding (a) above, consideration will be given to requests for
approval of special payments to plans that provide for the accrual of greater
benefits on account of a year of past service, than for a year of future
service or that provide for defined benefits for past service and money
purchase benefits for future service, on condition that:
(i) both past and future service benefits are reasonable in the circumstances
and benefits to be accrued or contributions required on account of future
service are not merely nominal,
(ii) benefits for past service are not accrued at a rate in excess of 2 per
cent per annum applied to average final earnings that are not in excess of the
best three consecutive years of remuneration paid to the member by the
(iii) the total pension payable under the plan is subject to the limitations
of 9(g) or 9(g.1) above.
20. Maximum Pension Benefits
The benefits being funded must be under the plan and must not exceed the
benefits permitted by 9(e) to 9(i) above, inclusive.
21. Maximum Value
The value of the pensions (including excess bridging benefits as referred to
in 9(g)(ii) above) payable to a member at retirement as a single life or a
joint and last survivor annuity must not exceed the value of a maximum
pension, as specified in paragraph 9(g) above, payable as a single life
annuity guaranteed for ten years or a 60 per cent joint and last survivor
annuity respectively, at the earliest of age 60, normal retirement age or age
at date of disability.
22. Salary Projection
(a) In cases of plans which provide for pension benefits based on best or
final average earnings at retirement, these benefits may be funded on the
basis of anticipated increases in salaries which reflect promotional,
productivity and economic increases, provided that the long term assumption
adopted for the salary scale is at least 1 per cent less than the long term
assumption concerning the rate of return on assets.
(b) In projecting remuneration for significant shareholders (as defined in
8(d) above) the following rules will apply:
(i) The base for the projection of remuneration must be no greater than the
average of the remuneration paid to the individual in the best three
consecutive years prior to the year in which the past service payment was
made, unless the plan requires that benefits be based on the average
remuneration of a greater number of years, in which event remuneration for
that number of prior years must be used to determine the base.
(ii) There must be evidence of an increase in remuneration during the
immediately prior five or more years and a reasonable expectation that such
increases will continue. Such evidence, duly certified by the employer, must
be submitted with the application for approval. Fluctuations within the period
are acceptable so long as a trend of increasing remuneration is established. A
substantial increase in remuneration in the last one or two years will not by
itself establish an increasing trend.
(iii) If a projection of remuneration is not warranted in the circumstances,
the past service liability must be determined from the remuneration base
defined in (i) above rather than from current remuneration.
23. Supplementary Pension Benefits
Supplementary pension benefits in accordance with 9(i) above may be funded on
the basis of anticipated long-term increases in the Consumer Price Index or
the excess earnings, as the case may be, in future years in regard to active,
retired and terminated members provided that the plan specifically defines the
employer's funding obligation. The long-term funding assumption concerning the
rate of return on assets normally must exceed, by at least 3 per cent, the
long-term assumption adopted for the funding of supplementary pension
Supplementary pension benefits based on excess earnings do not create an
obligation upon the employer to fund for such benefits and therefore such
benefits under a money purchase plan are not grounds for approval of a special
payment under paragraph 20(1)(s) of the Act.
24. Apportionment of Special Payments Between Employers
If a plan covers employees of two or more employers who are assuming past
service liabilities or current service costs in excess of the amount
deductible under paragraph 20(1)(q), whether or not they are subsidiary,
associated or affiliated companies, the cost must be apportioned on a
reasonable basis, having regard to the length of service and the remuneration
paid. However, where a plan covers employees of two or more divisions of the
same employer, special payments are not to be subdivided. Costs must also be
apportioned if one individual has had eligible past service with more than one
participating employer or has current service with more than one participating
25. Period and Duration of Approval
(a) Past Service - As a convenience to taxpayers the Department normally gives
approval under paragraph 20(1)(s) of the Act to special payments on account of
unfunded liability that comply with the requirements of that paragraph for the
three taxation years following the valuation date. Payments of such approved
amounts will be deductible in the taxation year in which the payment was made,
(i) such payment was made subsequent to the date of the actuary's
(ii) such payment was made either in the taxation year in which the
recommendation was made or in one of the three immediately following taxation
(iii) the actuarial assumptions were still valid at the time of payment.
Special payments that do not meet these conditions are not deductible under
paragraph 20(1)(s) of the Act. (For example, if a projection of remuneration
or anticipation of cost of living increase are revealed by subsequent
experience to be unacceptable, no deduction under paragraph 20(1)(s) may be
(b) Current Service - Approval of special payments on account of current
service may be applied for annually or for a three-year period following a
valuation date. In the case of annual approvals, the application may be
submitted after the end of the period when the actual amount and date of the
contribution has been determined, - provided that the payments were made
pursuant to a recommendation by an actuary. Such approvals are also subject to
the conditions and limitations set out in (a) above (See 26 below on
26. Application for Approval of Special Payments
(a) Application for approval of an amount pursuant to paragraph 20(1)(s) of
the Act must be made in writing by the employer or its authorized
representative, stating the amount for which approval is requested and, if
applicable, showing current service and past service payments separately. If
approval of other than a lump sum payment in respect of past service benefits
is requested, both the amount of the deficit at the actuarial valuation date
and the proposed schedule of payments (based on the employer's taxation year),
each as recommended by an actuary, should be stated. The schedule of payments
may contain a reasonable provision for interest to date of the request, as
recommended by the actuary.
The actuary's recommendation for payments on account of current service may be
expressed as a percentage of members' remuneration but the application under
paragraph 20(1)(s) must be for specific dollar amounts for each year.
If the plan is registered under the Pension Benefits Standards Act 1985 or
under a similar pension benefits act of a province, the employer (or his
representative) is to confirm that the same actuarial certificate, report and
recommendation to the employer (as required by this paragraph) have been
filed, for purposes of that Act, with the supervisory authority under that
(b) Where benefits are provided through the use of an allocated funding
instrument (meaning where the contributions are applied at the time they are
made to purchase benefits for the individual participants), a statement must
be furnished giving the following data with respect to each member, namely:
(i) name or number,
(iii) date of birth,
(iv) date of employment,
(v) remuneration upon which benefits are based.
If possible, the members should be listed in order of their birth dates, males
and females separately.
The statement must be certified by the employer - by an officer of the company
if the employer is a corporation. The certificate should be substantially in
the following form:
"I hereby certify that the information given hereon (or on the attached
sheets, as the case may be) is accurate and complete to the best of my
knowledge and belief and is in accordance with our records as the employer of
the members concerned."
(Position or rank of officer) ^
(c) Where benefits are provided through the use of an unallocated funding
instrument (meaning, where some or all of the contributions are accumulated in
an unallocated fund to be used to meet benefit payments as they come due or to
purchase annuities for participants at retirement or on earlier termination of
service with a vested right), the full valuation report of the actuary must be
furnished giving the following data:
(i) a brief history of the fund,
(ii) a description of the benefits provided by the plan as at the valuation
(iii) a statement, for both liabilities and assets, of the bases upon which
the valuation was made. With respect to liabilities, the statement should
include a description of the valuation method, the rate of interest, the
actuarial assumption with respect to death, disability, withdrawal,
retirement, etc., the remuneration scale, the relative ages of members and
spouses, etc. With respect to assets, in addition to the description of the
valuation method, both the market value and book value of the fund should be
stated. Where applicable, the actuary should identify areas where changes have
been made since the last valuation, e.g. funding method, valuation of assets,
interest assumption, termination rates, etc.,
(iv) detailed summaries of the members covered, showing for each age grouping
(e.g. quinquennial) the number of members, the remuneration upon which
benefits are based and the number of years of past service, if applicable, or
a two-dimensional grid showing remuneration paid for each age and year of
(v) such detailed summaries of the results of the valuation as may be
practicable (at least the valuation balance sheet on which the recommended
funding has been determined).
As far as possible, the actuary should reconcile the condition of the fund as
shown by this valuation with that shown by the last preceding valuation.
The employer must submit a statement certifying that the data submitted to the
actuary were accurate and complete.
(d) If benefits are to be provided for only a few employees, either through
the use of an allocated or unallocated funding instrument, a copy of the
working papers should be submitted with the valuation report. Revenue Canada,
Taxation or the Office of the Superintendent of Financial Institutions
(formerly the Superintendent of Insurance) may request the working papers, or
samples thereof, for other pension plans.
When significant shareholders are participating in the pension plan, a
statement of the remuneration of at least five immediately prior years must be
provided in regard to each such member.
(e) The actuary must append a certificate recommending the amount and timing
of payments and certifying that such payments are sufficient to ensure that
all the obligations of the plan in respect of current or past service of
members may be discharged in full. Where part of the current service cost or
unfunded liability is with respect to benefits or costs that exceed the
applicable limits, including cases where current service costs and unfounded
liabilities at the valuation date are with respect to projected or actual
pension benefits in excess of the maxima permitted by Parts I and II of this
circular, the actuary must indicate the amount of such excess and the method
by which this amount was arrived at. The Department will approve only that
portion of the current service cost or unfunded liability that is in regard to
benefits and costs that comply with applicable limits in this circular. All
reserve and surplus accounts should be eliminated in the determination of the
(f) Supplementary Approvals - If current service contributions have been
approved in advance of payment (see 25(b) above) and, due to remuneration
exceeding expectations, the contributions exceed the approved amount, the
employer may apply for a supplementary approval to cover the additional
amount. The employer may secure such approval by applying in writing stating
the additional amount for which approval is being requested, the taxation year
in which such amount was paid and the amount of remuneration paid in the year
in question and certifying that the contributions are in accordance with the
actuary's recommendation as previously submitted.
(g) Approval After Payment - If approval of current service contributions is
being sought annually after payment has been made (see 25(b) above), the
submission for the first year following a valuation date must be a full
submission in accordance with the above instructions. The applications for the
second and third years may be made by the employer or his authorized
representative and need not include valuation reports or actuarial
certifications. Such application must be made in writing stating the amount
for which approval is being requested, the taxation year in which such amount
was paid and the amount of remuneration paid in the year in question and
certifying that the contributions are in accordance with the actuary's
recommendation as previously submitted.
PART III - CURRENT SERVICE CONTRIBUTIONS BY EMPLOYERS
27. The amount of an employer's current service contribution to a registered
pension plan that is deductible without Ministerial approval is limited by the
provisions of paragraph 20(1)(q) of the Act and section 2700 of the
28. In the case of a registered pension plan under which the employer's
contribution, on behalf of each member, is identifiable as a dollar amount or
an amount determined pursuant to a formula or schedule in the plan or
contract, the amount deductible in respect of any one member is the
identifiable amount in respect of that member or $3,500, whichever is less, as
provided for in subparagraph 20(1)(q)(i) of the Act. Such plans will usually,
but not necessarily, be money purchase type plans.
29. In the case of all other registered pension plans, the amount deductible
will be determined under subparagraph 20(1)(q)(ii) of the Act and section 2700
of the Regulations.
30. In section 2700 of the Regulations, "employer's contribution" refers to
his actual payment to or under the plan in respect of services of his
employees rendered in the year. This is of significance in connection with
those plans under which the effect of withdrawal credits may mean that the
amount paid in respect of current service is less than the gross cost for such
current service. Thus, the amount paid may fluctuate from year to year
depending on how withdrawal credits arise.
31. As an example of the application of section 2700 of the Regulations,
suppose that the total payroll of all employees included in the plan was
$1,000,000 and that the employer's actual payment in respect of services of
employees rendered in the year under the plan was $85,680. The determination
of the portion of this payment that may be claimed for tax deduction purposes
in the year would be carried out as follows:
A Total payroll of covered employees $1,000,000
B Actual contribution of employer for current service $85,680
C Ratio that B is of A .08568
D Maximum limit on earnings - $3,500 divided by C $40,850
In respect of each employee, multiply the lesser of actual earnings or D
($40,850) by C (.08568) and the aggregate amount is the amount allowable as a
deduction under subparagraph 20(1)(q)(ii) of the Act.
32. Because most earnings will not in fact likely exceed the maximum limit, it
may be simpler to calculate the aggregate of the amounts by which individual
earnings exceed item D and multiply the result by item C. Suppose that in the
above example one employee received a salary of $41,850, meaning, an excess of
$1,000, and another employee's salary was $46,350, meaning an excess of
$5,500, and that no other employee's salary exceeded $40,850. The amount not
deductible as a pension contribution would be $6,500 multiplied by .08568 or
33. It should be pointed out that for the purpose of section 2700 of the
Regulations, "total payroll" includes all salaries, wages, commissions,
bonuses, etc., paid to an employee covered by the plan even if part of these
are not taken into account for pension purposes. For example, where some of
the employees are being paid salaries plus commissions and the plan only
provides for pension contributions based on salaries, the commissions paid to
persons covered by the plan will be included in determining "total payroll".
Likewise, if an employee is paid up for pension purposes, but is still covered
by the plan, the employee's salary will be included in determining "total
34. As an option, the taxpayer may identify the actual cost for each member
for benefits under the pension plan in respect of services rendered by that
member in the year, in which case the taxpayer may derive the "amount
determined in prescribed manner" by summing the amounts, each of which is
$3,500 or the amount identified with each member as described above, whichever
35. If an employer is contributing to more than one plan and each employee's
participation is restricted to one plan, the above calculations are to be made
independently in regard to each plan to which section 2700 of the Regulations
PART IV - OTHER PENSION PLAN MATTERS
36. Life Insurance Adjoined to Pension Plan
There may be adjoined to an insured pension plan, a provision for certain life
insurance benefits to be paid in the event of death prior to retirement. The
portion of the payment which is applied to purchase the life insurance
benefits must be segregated from the cost of the pension benefits and charged
as a separate insurance cost in the records and financial statements of
participating employers. The life insurance provision is not part of the
registered pension plan and any life insurance benefits derived from the life
insurance provision are not superannuation or pension benefits. However, any
death benefit paid under the pension plan (whether a return of contributions
or a minimum death benefit) must be reported as a pension benefit.
37. Deductibility of Contributions
(a) That portion of contributions by an employer to a registered pension plan
that is in excess of the maximum deductions permitted by paragraph 20(1)(q) of
the Act or that was not approved under paragraph 20(1)(s) of the Act is not
deductible in determining income for the year for purposes of the Act.
(b) Contributions on account of current or past service made by an employer to
an employees' pension plan that is not registered under the Act will not be
approved pursuant to paragraph 20(1)(s) of the Act and, therefore, are not
deductible in determining income for the year of contribution for purposes of
(c) Contributions, whether on account of current or past service, by a member
to an employees' pension plan that is not registered under the Act are not
deductible in determining the member's income for purposes of the Act.
38. Transfers to Other Plans
Paragraph 60(j) of the Act permits deduction from income, in designated
circumstances, of pension benefits that are reinvested in another registered
pension plan or registered retirement savings plan. Information Circular 79-
8R2 gives information regarding the forms and procedures pertaining to
transfers and the waiving of withholding tax on the benefits paid.
39. Refund of Surplus to Employer
(a) Insofar as this Department is concerned, a surplus in a pension plan, as
certified by an actuary if the plan is a defined benefit plan, may be refunded
to the contributing employer at any time. Where the surplus exceeds the
contributions that would otherwise be required to be made by that employer on
account of current service of employees in the following 24-month period, the
portion of the surplus which is in excess of such contributions is considered
by this Department to be excess surplus. The excess surplus must be
eliminated by one or a combination of the following means:
(i) refund to the employer
(ii) application against the employer's obligations for contributions on
account of current service in the current and subsequent years, or
(iii) improvement of benefits under the plan (where permissible).
(b) A refund to an employer is a superannuation or pension benefit pursuant to
subsection 248(1) of the Act and must be reported on forms T4A Supplementary
and T4-T4A Summary. Such amounts must be included in the income of the
40. Section 254 of the Act (Deferred Annuities)
In certain circumstances, the benefits payable out of or under a pension plan
may be paid out of or under a separate deferred annuity or other contract that
has been entered into for the purpose of paying the pension benefits.
Paragraph 254(a) of the Act provides that, if the rights under the deferred
annuity or other contract are those set out in the pension plan, the payment
out of the pension plan to acquire the deferred annuity or other contract will
be deemed not to be a pension benefit at that time. However, the payments
subsequently made under the deferred annuity or other contract will be deemed
to be payments out of the pension plan and will be income of the recipient
It should be noted that the deferred annuity or other contract substituted for
a registered pension plan must not contain cash settlement provisions other
than those which are acceptable under a registered pension plan, as specified
in 9(b) and (c) above.
41. Income of Trust
(a) Paragraph 149(1)(o) of the Act provides that the income of a trust
established solely for the administration of a registered pension plan will be
exempt from taxation under Part I of the Act.
(b) A trust which holds foreign property at the end of any month may be
subject to tax under Part XI of the Act. Consult your local district taxation
office for additional information.
(c) Each pension trust and pension corporation is required to file an annual
return (form T3P) within 90 days of the end of each year. These forms are
available at Revenue Canada, Taxation District Offices.
42. Employees' Past Service Contributions
Employees' contributions on account of past service can only be deducted in
determining income of the year to the extent permitted or required by the plan
and within the limitations of subparagraphs 8(1)(m)(ii) and (iii) of the Act,
as augmented by subsection 8(8). The plan may only permit or require past
service contributions on account of eligible service as described in 8(e)
43. Personal Information Banks
The Income Tax Act stipulates that information obtained by the Department for
purposes of the Act must be kept strictly confidential. Only the taxpayer who
is the subject of the information and persons properly authorized by law or by
that taxpayer have a right of access to such information. The Privacy Act and
the Access to Information Act reinforce that right.
EXTRACTS FROM CANADIAN LIFE TABLE, 1980-82
AGE 25 LIFE EXPECTANCY MALE 48.78 LIFE EXPECTANCY FEMALE 55.22
AGE 26 LIFE EXPECTANCY MALE 47.86 LIFE EXPECTANCY FEMALE 54.25
AGE 27 LIFE EXPECTANCY MALE 46.92 LIFE EXPECTANCY FEMALE 53.27
AGE 28 LIFE EXPECTANCY MALE 45.99 LIFE EXPECTANCY FEMALE 52.30
AGE 29 LIFE EXPECTANCY MALE 45.05 LIFE EXPECTANCY FEMALE 51.33
AGE 30 LIFE EXPECTANCY MALE 44.11 LIFE EXPECTANCY FEMALE 50.36
AGE 31 LIFE EXPECTANCY MALE 43.17 LIFE EXPECTANCY FEMALE 49.39
AGE 32 LIFE EXPECTANCY MALE 42.22 LIFE EXPECTANCY FEMALE 48.42
AGE 33 LIFE EXPECTANCY MALE 41.28 LIFE EXPECTANCY FEMALE 47.45
AGE 34 LIFE EXPECTANCY MALE 40.34 LIFE EXPECTANCY FEMALE 46.48
AGE 35 LIFE EXPECTANCY MALE 39.39 LIFE EXPECTANCY FEMALE 45.51
AGE 36 LIFE EXPECTANCY MALE 38.45 LIFE EXPECTANCY FEMALE 44.55
AGE 37 LIFE EXPECTANCY MALE 37.52 LIFE EXPECTANCY FEMALE 43.59
AGE 38 LIFE EXPECTANCY MALE 36.58 LIFE EXPECTANCY FEMALE 42.63
AGE 39 LIFE EXPECTANCY MALE 35.65 LIFE EXPECTANCY FEMALE 41.68
AGE 40 LIFE EXPECTANCY MALE 34.72 LIFE EXPECTANCY FEMALE 40.73
AGE 41 LIFE EXPECTANCY MALE 33.80 LIFE EXPECTANCY FEMALE 39.78
AGE 42 LIFE EXPECTANCY MALE 32.88 LIFE EXPECTANCY FEMALE 38.84
AGE 43 LIFE EXPECTANCY MALE 31.97 LIFE EXPECTANCY FEMALE 37.90
AGE 44 LIFE EXPECTANCY MALE 31.06 LIFE EXPECTANCY FEMALE 36.97
AGE 45 LIFE EXPECTANCY MALE 30.16 LIFE EXPECTANCY FEMALE 36.04
AGE 46 LIFE EXPECTANCY MALE 29.27 LIFE EXPECTANCY FEMALE 35.11
AGE 47 LIFE EXPECTANCY MALE 28.39 LIFE EXPECTANCY FEMALE 34.19
AGE 48 LIFE EXPECTANCY MALE 27.52 LIFE EXPECTANCY FEMALE 33.28
AGE 49 LIFE EXPECTANCY MALE 26.66 LIFE EXPECTANCY FEMALE 32.37
AGE 50 LIFE EXPECTANCY MALE 25.81 LIFE EXPECTANCY FEMALE 31.47
AGE 51 LIFE EXPECTANCY MALE 24.97 LIFE EXPECTANCY FEMALE 30.57
AGE 52 LIFE EXPECTANCY MALE 24.14 LIFE EXPECTANCY FEMALE 29.68
AGE 53 LIFE EXPECTANCY MALE 23.33 LIFE EXPECTANCY FEMALE 28.80
AGE 54 LIFE EXPECTANCY MALE 22.52 LIFE EXPECTANCY FEMALE 27.93
AGE 55 LIFE EXPECTANCY MALE 21.73 LIFE EXPECTANCY FEMALE 27.06
AGE 56 LIFE EXPECTANCY MALE 20.95 LIFE EXPECTANCY FEMALE 26.20
AGE 57 LIFE EXPECTANCY MALE 20.18 LIFE EXPECTANCY FEMALE 25.35
AGE 58 LIFE EXPECTANCY MALE 19.43 LIFE EXPECTANCY FEMALE 24.51
AGE 59 LIFE EXPECTANCY MALE 18.69 LIFE EXPECTANCY FEMALE 23.68
AGE 60 LIFE EXPECTANCY MALE 17.96 LIFE EXPECTANCY FEMALE 22.85
AGE 61 LIFE EXPECTANCY MALE 17.25 LIFE EXPECTANCY FEMALE 22.03
AGE 62 LIFE EXPECTANCY MALE 16.56 LIFE EXPECTANCY FEMALE 21.22
AGE 63 LIFE EXPECTANCY MALE 15.88 LIFE EXPECTANCY FEMALE 20.42
AGE 64 LIFE EXPECTANCY MALE 15.21 LIFE EXPECTANCY FEMALE 19.63
AGE 65 LIFE EXPECTANCY MALE 14.57 LIFE EXPECTANCY FEMALE 18.85
AGE 66 LIFE EXPECTANCY MALE 13.93 LIFE EXPECTANCY FEMALE 18.09
AGE 67 LIFE EXPECTANCY MALE 13.32 LIFE EXPECTANCY FEMALE 17.33
AGE 68 LIFE EXPECTANCY MALE 12.72 LIFE EXPECTANCY FEMALE 16.59
AGE 69 LIFE EXPECTANCY MALE 12.14 LIFE EXPECTANCY FEMALE 15.86
AGE 70 LIFE EXPECTANCY MALE 11.58 LIFE EXPECTANCY FEMALE 15.14
AGE 71 LIFE EXPECTANCY MALE 11.03 LIFE EXPECTANCY FEMALE 14.44
AGE 72 LIFE EXPECTANCY MALE 10.49 LIFE EXPECTANCY FEMALE 13.75
AGE 73 LIFE EXPECTANCY MALE 9.98 LIFE EXPECTANCY FEMALE 13.08
AGE 74 LIFE EXPECTANCY MALE 9.48 LIFE EXPECTANCY FEMALE 12.42
AGE 75 LIFE EXPECTANCY MALE 9.00 LIFE EXPECTANCY FEMALE 11.78
AGE 76 LIFE EXPECTANCY MALE 8.53 LIFE EXPECTANCY FEMALE 11.15
AGE 77 LIFE EXPECTANCY MALE 8.09 LIFE EXPECTANCY FEMALE 10.54
AGE 78 LIFE EXPECTANCY MALE 7.66 LIFE EXPECTANCY FEMALE 9.95
AGE 79 LIFE EXPECTANCY MALE 7.25 LIFE EXPECTANCY FEMALE 9.39
AGE 80 LIFE EXPECTANCY MALE 6.85 LIFE EXPECTANCY FEMALE 8.84
AGE 81 LIFE EXPECTANCY MALE 6.48 LIFE EXPECTANCY FEMALE 8.32
AGE 82 LIFE EXPECTANCY MALE 6.12 LIFE EXPECTANCY FEMALE 7.82
AGE 83 LIFE EXPECTANCY MALE 5.78 LIFE EXPECTANCY FEMALE 7.34
AGE 84 LIFE EXPECTANCY MALE 5.45 LIFE EXPECTANCY FEMALE 6.88
AGE 85 LIFE EXPECTANCY MALE 5.14 LIFE EXPECTANCY FEMALE 6.45
AGE 86 LIFE EXPECTANCY MALE 4.85 LIFE EXPECTANCY FEMALE 6.04
AGE 87 LIFE EXPECTANCY MALE 4.57 LIFE EXPECTANCY FEMALE 5.65
AGE 88 LIFE EXPECTANCY MALE 4.30 LIFE EXPECTANCY FEMALE 5.28
AGE 89 LIFE EXPECTANCY MALE 4.05 LIFE EXPECTANCY FEMALE 4.93
AGE 90 LIFE EXPECTANCY MALE 3.82 LIFE EXPECTANCY FEMALE 4.60