When is a waiver from my
spouse required?
If you have a spouse, pension legislation requires that
your pension be offered in a "joint and survivor" form, which provides for the
payment to your surviving spouse of a lifetime pension on your death of at least 60% of
the pension that was being paid to you. The amount of a life annuity payable to you at
retirement may be reduced to ensure that continuing payments can be made throughout your
lifetime and also your spouse's lifetime.
You may receive a pension that does not offer this
guaranteed survivor benefit only if your spouse signs the waiver prior to the commencement
of your pension. In other words, your spouse must sign a waiver prior to the purchase of a
single life annuity or an annuity with a survivor benefit of less than 60%
or the establishment of a Variable Benefit Account under a defined
contribution plan.
Form 3, Spouse’s
Waiver of 60% Post-Retirement Survivor Benefit, can be found in Appendix A.
Signing a waiver does not necessarily mean that your spouse
would receive no benefits on your death. For example, you could purchase an annuity that
provides a survivor benefit of less than 60% or a single life annuity with a guarantee
period and designate your spouse as the beneficiary. As
well, if you establish a Variable Benefit Account, your spouse
must be named as the beneficiary of the account.
When should the waiver be signed?
To be in force, a waiver must be signed within 90 days
prior to the commencement of your pension. Your spouse may cancel a signed waiver by
providing written notice to the pension plan administrator or financial institution that
issued the LIRA contract, prior to the commencement of the payment of an annuity that does
not comply with Section 34 of the Act. If the waiver is revoked, your pension must be
taken in the "joint and survivor" form. A waiver cannot be revoked after annuity
payments have started.
When is consent from my spouse required?
As an alternative to purchasing an annuity, you may be able
to transfer your money to a prescribed RRIF. Your spouse must sign a consent form prior to
the transfer of funds to a prescribed RRIF.
Form 1, Spouse’s Consent to Transfer
to a Registered Retirement Income Fund Contract.
A consent form is also required to be signed by your spouse
if you have money in a Life Income Fund (LIF) or a Locked-In Retirement Income Fund (LRIF)
contract and wish to transfer to a RRIF.
This is a new form. Any waiver forms previously signed by
your spouse are not sufficient to allow you to transfer to a prescribed RRIF.
If
you are a member or former member of a defined contribution plan
that offers a Variable Benefit as an option at retirement, you may
transfer your money to a Variable Benefit Account. Your spouse
must sign a consent form prior to the transfer of funds to a
Variable Benefit Account. Form
2.01, Spouse’s Consent to Transfer to a Variable Benefit
Account.
This is a new form. Any waiver or consent forms
previously signed by your spouse are not sufficient to allow you
to transfer assets to establish a Variable Benefit Account.
Where can my spouse get the waiver or consent forms?
Copies of the prescribed forms can be found at the end of
this bulletin or may be obtained from your pension plan administrator, the financial
institution administering your LIRA, LIF or LRIF, or the Pension
Division.
Who is responsible for ensuring the waiver or consent
form is signed?
The pension plan or financial institution that is
purchasing a life annuity or that is transferring your locked-in pension money to a RRIF
or a Variable Benefit Account
is responsible for ensuring the applicable form is properly executed prior to the transfer
or purchase. The waiver or consent is retained on their files. You should also keep a
copy.
Does my spouse have to sign a waiver before I can
transfer money to a LIRA?
No.
Are there circumstances where my spouse does not need to
sign a waiver?
The requirement to purchase a joint and survivor's pension
does not apply if you have money in a LIRA by virtue of being the surviving spouse of a
deceased plan member or as a result of a division of assets on spousal relationship
breakdown. You may purchase any form of pension without a waiver from your spouse. The
requirement to provide a survivor's pension only applies to former pension plan members.
Is a waiver required if an annuity is purchased from a
prescribed RRIF?
The answer depends on the form of annuity you purchase. If
you wish to purchase an annuity with the money in a prescribed RRIF, the annuity must
comply with Section 34 of The Pension Benefits
Act, 1992. In other words, the annuity must provide your spouse with a survivor
benefit equal to at least 60% of the pension that was being paid to you. If you wish to
purchase a single life annuity or a joint annuity paying less than 60% to your survivor,
then a waiver is required.
Is a waiver required if an annuity
is purchased from a Variable Benefit Account?
The answer depends on the form of annuity you
purchase. If you wish to purchase an annuity with the money in a
Variable Benefit Account, the annuity must comply with Section 34
of The Pension Benefits Act, 1992. In other words, the
annuity must provide your spouse with a survivor benefit equal to
at least 60% of the pension that was being paid to you. If you
wish to purchase a single life annuity or a joint annuity paying
less than 60% to your survivor, then a waiver is required.
Are there any other waiver or consent rules?
The waiver or consent form, whichever is applicable to your
situation, must be signed in the presence of a witness and outside of the presence of the
plan member or contract owner. We also recommend that your spouse obtain independent legal
advice before waiving the entitlement to a "joint and survivor" pension benefit
or signing a consent form to allow for a transfer to a RRIF or a
Variable Benefit Account.
Who is the beneficiary of my RRIF?
Your spouse must be named as the beneficiary of your
prescribed RRIF. However, your spouse may waive his or her designated beneficiary status
by signing a waiver and filing it with the financial institution
administering the prescribed RRIF contract before your date of
death. Form 2, Spouse’s Waiver of Designated Beneficiary Status,
can be found in Appendix A at the back of this bulletin.
Please note that your spouse may revoke the waiver at any
time before your date of death by providing notice in writing to the financial institution administering the
prescribed RRIF contract.
Who is the
beneficiary of my Variable Benefit Account?
Your
spouse must be named as the beneficiary of your Variable Benefit
Account. However, your spouse may waive his or her designated
beneficiary status by signing a waiver.
Form 2.02, Spouse’s Waiver of
Designated Beneficiary Status Under a Variable Benefit Account,
can be found in Appendix A.
The waiver must be completed and filed with the
administrator of your pension plan before your date of death.
Please note that your spouse may revoke the waiver at any time
before your date of death by providing notice in writing to the
administrator of your pension plan.
The Income Tax Regulations also allow
you to designate your spouse as a “specified beneficiary”. This
type of designation would permit the payments being made to you
from a Variable Benefit Account to continue to your spouse
uninterrupted upon your death. Your spouse would also have the
choice of transferring the assets out of the Variable Benefit
Account.
How is "spouse" defined?
For purposes of The Pension Benefits Act, 1992 and
its regulations, "spouse" means:
- a person who is married to a member or former member; or
- if a member or former member is not married, a person with
whom the member or former member is cohabiting as spouses at the relevant time and who has
been cohabiting continuously with the member or former member as his or her spouse for at
least one year prior to the relevant time.
What if my spouse and I are living separate and apart?
A legally married spouse would remain entitled to receive
the survivor’s pension and would have to sign a waiver before you could purchase a
single life annuity or a consent form before you could transfer money to a RRIF
or a Variable Benefit Account.
A married spouse is no longer entitled to a survivor’s
pension on divorce or where a couple have divided their property, including the pension
assets, in accordance with a court order or interspousal agreement pursuant to The Family Property Act.
By definition, common law couples must be cohabiting.
What if I’m separated from my married spouse, but I
am in a common law relationship?
A married spouse takes precedence over a common law spouse
even where a married couple is no longer living together.
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