Partition of the benefits accrued under a pension plan in the private, municipal or university sectors for married or civilly united persons
The value of accrued benefits under a pension plan in the private, municipal or university sectors during a marriage or civil union is part of
family patrimony. Therefore, the value of benefits can be partitioned in the event of a separation from bed and board, divorce, annulment of marriage, or a dissolution or annulment of a civil union.
Even when spouses are not covered by the dispositions of family patrimony, the value can be partitioned on those occasions if the matrimonial law that applies allows it and that the judgement or, as applicable, the notarized transaction contract provides for it.
De facto separation not made official by a court judgment or for civil union spouses by a notarized joint declaration, does not allow for partition.
Pension plan in the private, municipal or university sectors
Information on partition only concerns pension plans for which the members' benefits are subject to the
Supplemental Pension Plans Act.
There's a word for it!
These plans go by many names:
- pension plans
- registered pension plans
- pension funds
- employer pension plans
- private pension plans.
The benefits of a worker under a pension plan are subject to the
Supplemental Pension Plans Act if he or she holds a position under provincial jurisdiction in the private, municipal or university sector. The benefits of certain workers in the parapublic sector are also subject to it.
It is
the place where the member works, specifically where he or she worked when accruing benefits in his or her plan, which determines whether Québec's Act applies. It is the case if the person works in Québec, even if his or her pension plan is administered outside the province or if it is registered with a supervisory agency outside Québec.
The recognition of unions
Marriage
Marriage is a solemn act by which 2 people commit in public to:
- live together
- respect the rights and obligations regarding their union, which are conferred to them by law.
Civil union
Like marriage, a civil union is a solemn act by which 2 people commit in public to:
- live together
- respect the rights and obligations regarding their union.
However, unlike marriage, it is only valid in Québec and only recognized by Québec laws.
For example, it will be recognized for Québec tax purposes, but not for federal tax purposes. At the federal level, civil union spouses can however be recognized as de facto spouses if they meet the conditions of the law applicable.
The steps for partition of the benefits accrued under a pension plan in the private, municipal or university sectors
The Statement of Benefits is the only document that indicates the total value of the benefits accrued by an individual under a pension plan in the private, municipal or university sector, as well as the value of the benefits accrued during the marriage or civil union.
You must not rely on the annual statement of the plan to determine the benefits. The statement does not specify the value as at the date on which spouses require it. In addition, that value is not necessarily calculated using the method required for partition.
You can request a Statement of Benefits from the plan administrator as soon as you file proceedings for separation from bed and board or divorce, annulment of marriage, or a dissolution or annulment of a civil union.
You can also request a Statement if the spouses have not filed proceedings but are in family mediation, or if they have filed a joint procedure for the dissolution or annulment of the civil union with a notary.
If the spouses are not in one of those situations, the administrator is not required to provide a Statement, but can, in certain cases, agree to do so. For further information, you must contact him or her.
Request the Statement
To obtain the Statement of Benefits, Retraite Québec offers forms that contain all the required instructions so that the request is complete.
Choose and complete the appropriate form:
Fees may be required for the production of the Statement.
The form must be sent to the pension plan administrator and not to Retraite Québec.
The plan administrator must produce the Statement of Benefits within 60 days after receiving the request.
To contact the plan administrator
Consult the last annual statement or use our
consultation of pension plans supervised by Retraite Québec online service to obtain the name and contact information of the plan administrator.
Benefits are not partitioned automatically. You must file a request. It is best to do so as soon as possible after the breakdown of the union.
The request for partition can be filed as soon as the delay for an appeal against your judgment has expired, that is,
30 days after the date on which it was rendered.
For spouses who are in a civil union who dissolve their union before a notary, the request for partition can be filed as soon as the annulment or dissolution of the civil union is officialized with the signature of the notarized joint declaration.
The amount that the former married spouse or spouse in a civil union will receive will be indicated on the judgement, on the agreement that was confirmed by a judgment, or in the case of civil union spouses who dissolve their union before a notary, on the notarized transaction contract,
plus interest. The amount will generally be expressed with a proportion (for example, half of the value of the benefits that was accumulated during marriage) or with a fixed amount (for example, $20 000).
Requesting partition:
In order for the administrator to
carry out partition of pension plan benefits, one of the spouses must request it. Retraite Québec has an
Application for Partition Following the Breakdown of a Marriage or Civil Union form.
Fees may apply for the partition.
The form must be sent to the administrator of the pension plan and not to Retraite Québec.
Payment methods
The former spouses partition the amounts accrued under the pension plan of the member, and not the pension that will be paid to him or her in retirement. The former spouse will therefore not receive a retirement pension.
Except in certain cases, the former spouse cannot receive his or her portion in cash. He or she can transfer the amount to a locked-in retirement account (LIRA) or life income fund (LIF) to generate retirement income.
The Statement of Benefits from your pension plan administrator indicates the choices offered as well as the documents and the information to provide based on each choice. If the former spouses did not request the Statement, they must contact the pension plan administrator to obtain that information.
The former spouse will be able to receive his or her portion in cash in the following cases:
- if the amount receivable (capital + interest) is less than 20% of the
maximum pensionable earnings (MPE) for the year in which he or she receives payment. The
MPE is established in accordance with the
Act respecting the Québec Pension Plan. For example, in
2024, the
MPE is $68 500. The member's former spouse can receive a lump-sum payment if he or she is entitled to an amount of less than $13 700
- if one of the spouses has not lived in Canada for at least 2 years
- if the person participating in the plan can receive a lump sum payment (for example, if he or she has a locked-in account under a simplified pension plan).
Any cash received will be taxable. However, income tax can generally be deferred by transferring it directly to a registered retirement savings plan (RRSP) or to a registered retirement income fund (RRIF).
To contact the plan administrator
Consult the last annual statement or use our
consultation of pension plans supervised by Retraite Québec online service to obtain the name and contact information of the plan administrator.
Impact of the partition of benefits accrued under the pension plan
Payment of an amount drawn from his or her pension plan to the former spouse reduces by an equivalent value the member's rights in his or her plan. Furthermore, before you decide to partition, you must consider the repercussions, particularly on the following aspects.
Interest and key dates
Interest will be added to the amount paid to the former spouse, even if it is not provided for in your judgment or agreement. It is calculated for the period that starts on the date of the valuation of the benefits (which is generally the date on which the conjugal relationship ended or the date on which the motion to institute proceedings) until the date on which the amount is paid to him or her.
It is unecessary, and sometimes illegal, to set the date of valuation of the benefits on the date of the judgement so that the former spouse receives exactly half of the member's benefits on that date because the
Regulation respecting supplemental pension plans provides for the mandatory addition of interest to ensure that the former spouse will not be penalized by the time elapsed before receiving his or her money.
If the member is retired, the time elapsed between the date of the valuation of the pension and the date on which an amount is paid to the former spouse is taken into consideration in the calculation of the pension after partition.
For Example:
The spouses agree that the member will pay half of the value of his or her pension of $2000 per month on the date on which the conjugal relationship ended.
The pension will first be reduced to $1000 per month.
It will also be reduced by an additional amount, to take into account the fact that the member received $2000 per month instead of $1000 per month, between the date on which the conjugal relationship ended and the date on which the amount agreed upon, with interest, is paid to his or her former spouse.
Therefore, the partition in equal parts of a retiree's pension will decrease his or her pension by more than half after partition. The more time there is between the valuation date and the partition date, the smaller the pension will be.
In the event of death
As a rule, in the event of divorce, separation from bed and board or annulment of marriage, annulment or dissolution of civil union, the former spouse looses his or her right to receive a benefit when a member dies. As each situation is specific, you must contact the plan administrator for more information.
If the member is retired and received a pension that was joint to his or her former spouse (it was expected that the former spouse would receive a pension following the death of the member), it is possible that certains choices are available to the member, such as, increasing the amount of his or her pension. You must contact the plan administrator for more information.