Procedures for converting a defined contribution plan into an SIPP

These procedures are intended for employers acting as plan administrators, for plans with fewer than 26 members and beneficiaries, or pension committees, as the case may be.

Notify Retraite Québec of your intention to convert your pension plan

You must send Form I: Application to obtain confirmation to use the conversion procedure to Retraite Québec as soon as the decision has been made to convert the pension plan into a simplified pension plan (SIPP) in order to get Retraite Québec's confirmation that the conversion process can be started.

Plan's conversion date

• The conversion date cannot be:
  • prior to the date that the member contributions stopped being collected
  • more than 30 days before the date on which the conversion notice is sent to the active members (unless all members active on the conversion date have given their written consent)
• The conversion date cannot be set more than 60 days after the date on which the conversion notice was sent.

• The date on which the company joins an SIPP cannot be later than the day after the conversion date.

  A helpful example...

  • To convert a plan on 30 September 2023, the conversion notice must be sent between 1 August (30 September - 60 days) and 30 October (30 September + 30 days).
  • If the notice is sent after 30 October, written consent from active members is required.
  • The employer must join an SIPP no later than 1 October 2023.

Send a conversion notice (the employer's responsibility)

You must send the conversion notice to:

• the pension committee and the insurer, if any
• all plan members and beneficiaries
• the union(s), if any

A copy of the notice must be sent to Retraite Québec immediately.

At the same time, active members who join the SIPP must be informed in writing of any provisions under the SIPP whose effects are not the same as those of the plan being converted, with respect to the following subjects:

• conditions for membership and withdrawal of membership
• employer contributions and, if applicable, member contributions or the method of calculating those contributions

Contents of the conversion notice

• Identification of the pension plan (plan name and registration number with Retraite Québec)
• Plan conversion date
• members and beneficiaries affected by the conversion
• a provision that the plan is being terminated for the purpose of converting it into an SIPP with the financial institution indicated.

Sending statements of benefits to members and beneficiaries

Within 60 days of the conversion date or sending of conversion notice, whichever is later, you must send a statement of benefits to every pension plan member and beneficiary. View the contents of the statement in detail (Appendix I).

Payment of benefits to members and beneficiaries

After considering the views of the members and beneficiaries, you must pay their benefits within 60 days following the date on which statements of benefits were sent.

Filing an annual information return

If the conversion date coincides with the date of the last fiscal year of the plan, you must send an annual information return to Retraite Québec, as well as appendices 1 and 2 and sections 1, 2 and 3 of Appendix 3A of the return.

The return, accompanied with required fees, must be sent no later than the date on which Form II: Confirmation of the conversion and payment of members' and beneficiaries' benefits is sent. The form was included with "Newsletter number 17".

Report to Retraite Québec on payment of benefits

Within 30 days following payment of benefits to members and beneficiaries, you must report such payment to Retraite Québec about the payment by sending in Form II, duly completed.

See...

Newsletter number 17 (June 2004) published by the Régie des rentes du Québec.