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Enhancement of the Pension Credits Purchased Following a Buy‑Back

All persons affected by the enhancement will receive a personalized letter from Retraite Québec. The letter will be mailed by 7 May at the latest and/or uploaded to My Account.

Important reminders

You are entitled to an enhancement of your buy-back pension credits. The enhancement includes the annual indexation of a portion of the buy-back pension credits based on the rate of increase of the Pension Index (PI).

Therefore:

If you have already retired

The indexation is retroactive to the later date between 1 January 2021 and 1 January of the year that follows the starting date of your retirement pension. If applicable, you will receive pension arrears to which we will add the applicable interest.

If you have not retired

The indexation will apply on 1 January following the date on which you retire.

The enhancement is further to the Act amending mainly certain Acts establishing public-sector pension plans, which was assented to on 6 April 2023 by the National Assembly of Québec. The Act provides for the enhancement of the pension credits, according to the terms and conditions determined by the RREGOP Pension Committee.

In a resolution passed on 6 October 2023, this committee agreed to an enhancement through an annual indexation of a portion of the buy-back pension credits. A person will be able to benefit from it once he or she retires.

Additional information

Here are answers to certain questions you may have.

How is the amount of indexation to which I am entitled calculated?

Here is an example of the calculation for a person who retired before 2021:

Value of the portion of the pension credit covered by the enhancement as at 31 December 2020: $300

2021 indexation
PI: 1.0%
Calculation: $300 X 1% = $3
$300 + $3 = $303

2022 indexation
PI: 2.7%
Calculation: $303 X 2.7% = $8.18
$303 + $8.18 = $311.18

2023 indexation
PI: 6.5%
Calculation: $311.18 X 6.5% = $20.23
$311.18 + $20.23 = $331.41

2024 indexation
PI: 4.4%
Calculation: $331.41 X 4.4% = $14.58
$331.41 + $14.58 = $345.99

My spouse is entitled to a higher indexation amount than mine. Why?

Although indexation rates are the same for everyone, the amount to which a person is entitled varies according to the value of their pension credit. The value of the pension credit can vary from one person to another, as it depends on the following factors:

  • the number of years bought back;
  • the pensionable salary at the time of the buy-back;
  • the time of the buy-back.

The amount of indexation varies depending on when a person starts receiving his or her retirement pension. For example, a person who began receiving his or her pension in 2021 will be entitled to a higher amount than a person who began receiving his or her pension in 2023.

My sister received an enhancement of her pension credit in 2023. I am receiving one this year, but my amount is much lower than hers. Why?

The enhancement of pension credits carried out in 2023 concerned pension credits purchased following the transfer of a supplemental pension plan or a transfer agreement. In addition, the terms and conditions were different. The enhancement consisted of a lump-sum payment.

This year's enhancement concerns a buy-back pension credit and consists of an annual indexation.

Which documents will I need to complete my income tax returns?

  • Federal government: T4A slip
  • Provincial government: RL-2 slip

The documents will be sent to you by Retraite Québec at the beginning of the year following the concerned fiscal year.

Other useful information

Persons entitled to the enhancement must have bought back service, which entitles them to a buy-back pension credit.

The main buy-back that entitles you to a buy-back pension credit is the following:

A person who bought back, before 1 July 2011, periods of service prior to becoming a member of RREGOP, the Pension Plan of Management Personnel (PPMP) or the Retirement Plan for Senior Officials (RPSO).

Not all buy-backs entitle you to a buy-back pension credit. If you are in one of the following situations, you did not purchase a buy-back pension credit and therefore, you are not entitled to the enhancement:

  • you bought back periods of absence without pay;
  • you bought back periods of absence related to a maternity leave or personal leave in connection to pregnancy or childbirth, paternity leave or leave of the parent who did not give birth to the child.

Several other situations do not entitle you to a buy-back pension credit.

Enhancement of the pension credits purchased following the transfer of a supplemental pension plan or a transfer agreement

The enhancement takes the form of a lump sum. You will receive that sum because the latest actuarial valuation of the Government and Public Employees Retirement Plan (RREGOP) shows a surplus related to the pension credits you received.

Here is information regarding the terms and conditions related to the enhancement:

  • The lump sum of the enhancement corresponds to a percentage of the total value of your benefits from your pension plan. It will not affect your annual pension.
  • The amount you will receive will be made up of the lump sum and applicable interest for the period from 21 August 2023 to the date of payment. No additional amounts related to this enhancement will be paid to you in the future.
  • You cannot request for the lump sum to be paid later.

  • The tax deduction rates that apply to the lump sum are the following:

    Amount of $5000 or less

    • Provincial: 14%
    • Federal: 5%
    • Federal outside Québec*: 10%
    • Non-resident**: 25%

    Amount greater than $5000 and equal to or less than $15 000

    • Provincial: 19%
    • Federal: 10%
    • Federal outside Québec*: 20%
    • Non-resident**: 25%

    Amount greater than $15 000

    • Provincial: 19%
    • Federal: 15%
    • Federal outside Québec*: 30%
    • Non-resident**: 25%

    * Federal outside Québec: If you live in Canada, but outside Québec.
    ** Non-resident: If you lived outside Canada.

Other useful information

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