Article

LEGISLATION

BILL C-30 RECEIVES ROYAL ASSENT

Bill C-30, Spring Economic Update 2026 Implementation Act, has received Royal Assent. For details of amendments of interest to the Canada Pension Plan and Income Tax Act, including effective dates, see our Summer 2026 Newsletter.

OLD AGE SECURITY AMENDMENTS

Effective June 12, 2026, the Old Age Security Regulations were amended to add explicit rounding provisions when calculating certain benefits, thus eliminating the possibility of benefit payments with fractions of cents. Affected benefits include the Allowance for the Survivor, as well as top-ups for the Guaranteed Income Supplement (GIS), the Allowance and the Allowance for the Survivor (previous rounding provisions had applied to the Old Age Security pension, the GIS and the Allowance). The amendments were made to correct a previous drafting omission; however, government IT systems have been rounding all OAS benefit entitlements since their introduction at various times.

DRAFT TECHNICAL ITR AMENDMENTS

The federal government has released draft technical amendments to the Income Tax Regulations, which would:

Update statutory references under section 8303(6) – Past Service Pension Adjustment – Qualifying transfers (effective retroactively to January 1, 2025)
Permit member contributions that reimburse a plan for actuarial services related to pension division on marriage breakdown, under section 8502(b) – Permissible Contributions (effective July 23, 3036)

ONTARIO PENSION AMENDMENTS, EFFECTIVE JULY 1, 2026

The following amendments to the Pension Benefits Act (PBA) and its General Regulation (Regulation) took effect on July 1, 2026:

Increased guaranteed monthly payment under the Pension Benefits Guarantee Fund (PBGF) for plans with a wind up date on or after March 26, 2026, from $1,500 to $3,000
Adjusted reporting requirements, as set out in section 14 of the Regulation, to reflect the increased PBGF monthly payment amount
Repeal of subsections 73(3) and (4) of the PBA, which provided that a plan administrator was generally not required to purchase life annuities in connection with a partial wind up (partial wind ups are not permitted for plans with an effective date on or after July 1, 2012)

ONTARIO REGULATORY PROPOSAL: JSPP MERGERS AND PBGF ASSESSMENTS

Ontario has released a regulatory proposal (first announced in the 2026 Ontario Budget, see our Spring 2026 Update) to eliminate PBGF assessments and related assessment certificates that are due after an application to merge a DB single employer pension plan into a jointly sponsored pension plan under section 80.4(11) of the PBA is filed. Currently, PBGF assessments and coverage only end after the merger is completed. The exemption would be conditional, so that if the transfer of assets and liabilities is not completed, the exemption would be reversed and the employer required to pay the assessments otherwise due. The comment deadline is November 1, 2026, and the proposed changes are expected to take effect on January 1, 2027.

ONTARIO REGULATORY PROPOSAL: UNLOCKING PENSION FUNDS

Ontario has released a regulatory proposal concerning unlocking pension funds. The proposed amendments are to Schedules 1, 1.1, 2 and 3 of the General Regulation (909) under the Pension Benefits Act and would allow full unlocking of:

Life income funds and locked-in retirement income funds
Locked-in retirement accounts, if the balance is less than 40% of the Year's Maximum Pensionable Earnings

Once implemented, eligible locked-in account owners could apply to their financial institution to unlock their funds. Applications would include a requirement for spousal consent. The government’s consultation on the proposal closed on October 2, 2026.

ONTARIO REGULATORY PROPOSALS: OMERS SPONSOR CORPORATION

Bill 68 amended the Ontario Municipal Employees Retirement System Act, 2006 to modernize the OMERS governance model (see our Winter 2026 Update). A key proposal is to replace the Sponsors Corporation with a Sponsors Council that would be responsible for plan design, contribution rates, plan amendments, and passing a by-law on the composition and selection of members for the Administration Corporation. Until October 23, 2026, the government is seeking feedback on the:

Consequential amendments would also be made to the Municipal Act, 2001, while the Regulation addressing CUPE Local 416's seat on the OMERS Sponsors Corporation Board during the transition period would be repealed.

REGULATORY UPDATE

OSFI 2027-2028 BASIC RATE

The Office of the Superintendent of Financial Institutions has set the Basic Rate for the April 1, 2027 to March 31, 2028 fiscal year at $12.00 per member. This is unchanged from the current fiscal year. The annual assessment for federally regulated pension plans and pooled registered pension plans is calculated by multiplying the Basic Rate by the number of plan beneficiaries (within a minimum and maximum range).

OSFI INFOPENSIONS – ISSUE 34

The Office of the Superintendent of Financial Institutions (OSFI) has released InfoPensions – Issue 34. New announcements that have not been previously reported include the following:

Best practices for DC pension plans (including investment choices, SIPP requirements, annual filings, filing and disclosure of plan amendments, and adherence to relevant CAPSA Guidelines.
Later this year, OSFI will publish guidance on the new unclaimed pension balances framework (see our Summer 2026 Newsletter). Plan administrators will be expected to make appropriate efforts to locate members, former members, survivors and other persons entitled to benefits before balances could be transferred to the Bank of Canada. OSFI will begin accepting applications no earlier than January 1, 2027.
As at December 31, 2025, the median Estimated Solvency Ratio was 1.28, up from 1.20 at the end of 2024, with 93% of plans with DB provisions fully funded. Overall, the solvency situation of federally regulated private pension plans is expected to decrease due to recent interest rate and market volatility.
OSFI is reviewing the findings from its Pension Plans Survey (PPS) 2025-26 Final Report, and will develop an action plan to address key areas for improvement.

FSRA 2026-2027 PENSION ASSESSMENT

The Financial Services Regulatory Authority of Ontario has announced its 2026-2027 pension assessment. For the period April 1, 2026, to March 31, 2027, the following marginal fees apply per pension beneficiary:

1,000 or fewer: $11.44
1,001 to 6,000: $9.11
6,001 to 12,000: $6.93
12,001 to 60,000: $3.12
60,001 to 150,000: $1.65
Over 150,000: $0.06

The minimum assessment fee for plans with fewer than 92 beneficiaries is $1,000.

UPDATED FSRA WAIVER FORMS

The Financial Services Regulatory Authority of Ontario has updated the following waiver forms:

Changes include:

Noting that a witness must be an adult who is not the spouse’s spouse (i.e., not the member or former member) (all forms)
Requiring additional witness information (telephone number and email address) (all forms)
Requiring that the form be dated, signed and delivered to the plan administrator before the death of: the Plan Member (Form 4); or the account owner (Form 4.1) (the current forms state only that they must be delivered to the plan administrator)

Both the updated and current versions of each waiver form can be used until November 30, 2026, after which only the updated version can be used.

FSRA PENSION UPDATE

The Financial Services Regulatory Authority of Ontario (FSRA) has released its latest Pension Update (August 2026). It sets out:

When FSRA may grant administrative relief from certain filing requirements for plans that purchase buy-out annuities for DB entitlements (depending in part on whether or not any surplus or DB liabilities remain)
Notice and communication approaches when a Specified Ontario Multi-Employer Pension Plan converts to a target benefit multi-employer pension plan
How plans should report surplus or prior year credit balance used to reduce required normal cost contributions on the Annual Information Return
Expected changes in 2027, including: updates to the Actuarial Information Summary for Ontario registered plans with respect to DC membership statistics and annuity purchase reporting; and updates to the Pension Services Portal including new cybersecurity and privacy elements
How plan administrators can avoid administrative monetary penalties and other regulatory actions, including what can or cannot qualify as mitigating circumstances

ONTARIO DB FUNDING REPORT (2025) AND ESTIMATED SOLVENCY STATUS (Q2 2026)

The Financial Services Regulatory Authority of Ontario (FSRA) has released its 2025 Report on the Funding of Defined Benefit Pension Plans in Ontario, which is based on valuation reports for single employer and multi-employer DB plans with valuation dates between July 1, 2022 and June 30, 2025, and on financial statements filed for the fiscal year ending between July 1, 2024 and June 30, 2025:

Median funded ratio was 114% on a going-concern (GC) basis (up from 112%) and 117% on a solvency basis (up from 112%), while 87% of plans were fully funded both on a GC and solvency basis
Median estimated projected GC funded ratio, determined as of December 31, 2025, was 117% (up from 115%)
Median projected solvency ratio was, as of December 31, 2025, 122% (up from 120%)
Estimated minimum required contributions for 2026 were $23.2 billion (up from $21.4 billion)
Overall asset allocations were relatively unchanged, average gross investment returns were similar across all sizes and types of plans, and the overall fee gap narrowed slightly (as between smaller plans with under $10 million in assets and larger plans with over $1 billion in assets)

Future reports will include information on target benefit plans once sufficient data is available. As of August 2026, FSRA received 15 applications for target benefit conversions. Ontario’s new target benefit framework was implemented on January 1, 2025 (see our Fall 2025 Update).

As of June 30, 2026 (end of Q2), the median solvency ratio was 127% (up from 122% during the previous quarter), which FSRA attributes to strong pension fund investment returns and unchanged pension liabilities.

PBGF REPORT - YEAR END MARCH 31, 2026

The Financial Services Regulatory Authority of Ontario (FSRA) has released the Pension Benefits Guarantee Fund (PBGF) Report - Year end March 31, 2026. It notes the recent increase in the Benefits Guarantee Limit to $3,000 (see above); confirms that the PBGF continues to maintain strong solvency levels, prudent risk management practices, and enhanced monitoring capabilities; and sets out the steps FSRA takes to address PBGF risks and support its long-term sustainability and adequacy. Additional information set out in the Report, as of March 31, 2026 where applicable, includes:

Total PBGF market value was $1.421 billion
PBGF assets achieved a net rate of return of 3.98%
90% of 774 PBGF eligible plans had a solvency surplus, while the 10% of PBGF eligible plans with a solvency deficit represented an assessment base of $739 million
The top three sectors with plans in solvency deficit were: Consumer discretionary, Materials, and Financials
Median solvency ratio increased from 119% to 122%, with 98% of plans having a solvency ratio at or above 85%
Approximately 34% of PBGF eligible plans were concentrated in three sectors: Materials, Health care, and Consumer staples
In an average year, the PBGF receives five claims and pays out $29 million, with most claims small relative to total PBGF assets
FSRA is assessing its role after enhanced priority for pension deficits in insolvency proceedings is introduced under the Pension Protection Act (Bill C-228)

CASELAW

MISSED PENSION SERVICE WHILE ON STATUTORY LEAVE

In Williams v. Enbridge Gas Inc., the Ontario Superior Court of Justice approved a class action settlement that required Enbridge to compensate employees on leave for whom it had not made required pension contributions.

Section 51(3) of the Employment Standards Act, 2000 requires an employer to continue making its contributions to a pension plan (as well as other benefits plans) for employees on most protected leaves of absence unless, with respect to contributory plans, an employee provides written notice that they do not intend to make their own contributions. The main Enbridge pension plan was contributory until 2021. However, in prior years Enbridge had not followed the requirements under s. 51(3) with respect to pension contributions for 223 current and former employees on pregnancy, maternity and/or parental leave – for whom there was no written notice that they would not make employee contributions. As a result, their credited service and pension benefits were lower than they should have been.

Under the settlement, Enbridge will pay $826,836 (before deductions), representing 75% of total class losses. This was an adequate level of recovery in light of various litigation risks, including lack of clarity concerning the size of the class (in part because the claims of unionized employees should be handled through the grievance arbitration process), the scope of appropriate damages, and possible limitation defences. The Court also noted recent jurisprudence emphasizing that “an unworkable class definition, or a class that was not clearly defined, weighed against certification”, which “poses a particular concern in pension benefits cases, where class members often fall into several overlapping categories”.

The approved settlement involves a simplified claims process, with each class member assigned a pre-calculated portion of the value of their missed pension service, based on individual data and actuarial analysis. Another benefit noted by the Court was not retaining a third-party administrator, as is common in such cases, thus maximizing payout for class members. Instead, a claims protocol will be administered by Enbridge, with oversight and monitoring by class counsel. Enbridge will also correct minor omissions or errors, and will not deny compensation simply because a claim form is incomplete or improperly completed. Class counsel fees representing 30% of total recovery were also approved; however, an honorarium for the representative plaintiff was rejected.

LTD COVERAGE PAST AGE 65

In CUPE, Local 145 v. Ellisdon Facilities Services (Osler) Inc., an Ontario labour arbitrator held that the employer had breached the parties’ collective agreement by refusing to consider the grievor’s application for long-term disability (LTD) coverage, because he was past the age of 65.

At the time of disability, the grievor was over age 65. The employer’s former and current group insurance plans expressly stated that LTD benefits were terminated when a member turns 65; however, there were conflicting statements in various plan brochures/documents. Although the employer’s practice was to stop deducting LTD insurance premiums from employees’ pay cheques four months before their 65th birthday, there was no evidence that any employees over age 65 years had applied for or been denied LTD benefits.

The Arbitrator allowed the Union’s grievance and ordered that the grievor’s LTD application be accepted for consideration by the employer. No estoppel was established as there was no evidence that the Union was aware of the employer’s practice to end coverage for employees past age 65. Neither would employees necessarily connect changes in their paycheques (fewer deductions) and the end of their benefits four months later, once they turned 65. The Employer also failed to establish that it would suffer detrimental reliance as a result of potentially high costs of obtaining LTD coverage, as the Arbitrator refused to take judicial notice of such costs. While previous rulings had confirmed that extending LTD coverage to employees over age 65 can be costly, those rulings were based on “extensive actuarial evidence” concerning the costs of either securing LTD coverage or, if that was unavailable or prohibitively expensive, self-funding the benefit.

FST UPHOLDS ADMINISTRATIVE MONETARY PENALTIES

In Raven Steel v. Ontario (CEO of FSRA), 2026 ONFST 8, the Financial Services Tribunal (FST) upheld FSRA’s decision to impose $46,500 in summary administrative penalties against the sponsor of a pension plan for failing to file required regulatory documents, including the plan’s Annual Information Return and Financial Statements, on time. The filings were approximately 215 days overdue.

The Tribunal found that the employer had a history of late filings and had failed to respond adequately to multiple reminders and warnings. It concluded that FSRA had correctly applied the penalty provisions under the PBA and related regulations, and that the penalties were appropriate to encourage compliance with pension regulatory requirements.

The decision reinforces FSRA’s willingness to use administrative monetary penalties to address persistent non-compliance with pension filing obligations.

HRTO DISMISSES SURVIVOR BENEFIT DISCRIMINATION CLAIM

In Murray v. Ontario Teachers’ Pension Plan Board, 2026 HRTO 858, the Human Rights Tribunal of Ontario (HRTO) dismissed an application alleging discrimination based on disability, family status, and marital status related to pension survivor-benefit elections.

The applicant, a retired teacher, argued that the Ontario Teachers’ Pension Plan Board (OTPPB) had failed to adequately explain that his election of a 70% survivor benefit was irrevocable and later refused to allow him to change the election after his wife’s death. He alleged discrimination based on disability, marital status and family status, but did not provide evidence that these characteristics influenced OTPP’s actions or decisions.

The HRTO confirmed that it does not have jurisdiction over general allegations of unfairness; applicants must demonstrate a connection between the alleged adverse treatment and a Human Rights Code-protected ground. Dissatisfaction with pension administration decisions, without a nexus to a protected ground under the Code, is plainly outside the HRTO’s jurisdiction.

RRIF WITHHOLDING TAX – CLASS ACTION SETTLEMENT APPROVED

In Hunter v. BMO Trust Company, the Ontario Superior Court of Justice approved a class action settlement involving approximately 1,500 plaintiffs who alleged that withholding taxes from their RRIFs should have been paid based on individual amounts withdrawn for each transaction, not on the total amount withdrawn during the year, which was BMO’s policy between 2014 and 2024. However, this policy had resulted in higher amounts withheld, which in turn left lower amounts in the plaintiffs’ RRIFs to invest on a tax-free basis. The Court noted the complexity of calculating damages in this case, which involved variables such as: what individual class members would have done with the excess funds in their accounts; their individual tax rates; and the number of years that any excess funds would have been invested before needed for retirement. BMO also alleged that the plaintiffs suffered zero losses, even if its policy was inappropriate, because they could have invested their excess amounts in a TFSA.

The Court considered the $1.9 million settlement amount reasonable given the litigation risks involved and because it represented a substantial proportion of BMO’s potential exposure, which was between $1 and $5 million. The average age of class members was 81, many could be dead, and one-third of the impacted RRIF accounts were closed. Therefore, payment via direct deposit was not practicable; while running a claims process was prohibitively expensive (up to $550,000). Therefore, a cy-près payment was the only realistic approach – i.e., to a charitable or not-for-profit recipient (HelpAge Canada). Class counsel fees of 30% were also approved, though litigation funding had been received from the Class Proceedings Fund.

TAXATION

NEW REGISTERED PLAN ADMINISTRATOR ACCOUNT (RPAA) PORTAL

The Canada Revenue Agency (CRA) has launched its Registered Plan Administrator Account (RPAA) Portal, which can be accessed through CRA’s My Account. All registered plan administrators and authorized representatives are encouraged to use the RPAA Portal for plan submissions. Key features include:

Online document submission
Streamlined account management
Simplified communications

CRA’s Filing savings and pension plan information with the CRA webpage has also been updated to advise that a plan administrator or authorized representative:

Should apply for a new registered plan number through the RPAA Portal rather than submitting registration documents by mail
Can only mail paper forms and supporting documents to the Registered Plans Directorate when electronic submission is not yet available, or when instructed by CRA; otherwise, they should use the “Submit documents” feature in the RPAA Portal

CRA GUIDANCE ON DELAYED PENSION ENTITY ASSESSMENTS

The Canada Revenue Agency has released two GST/HST Notices on recent Excise Tax Act (Act) amendments that extend, in certain circumstances, the two-year limitation period for a pension entity to claim the pension entity rebate or an input tax credit, or to make the pension entity rebate election. The amendments are set out in Bill C-47–Budget Implementation Act, 2023, No. 1 and apply retroactively to tax paid after August 9, 2022.

GST/HST Notice 347 – Delayed Assessments and the GST/HST Rebate for Pension Entities provides a detailed overview of the amendments and addresses issues such as:

Meaning of “claim period”
Conditions under which the new deeming rule will apply in relation to tax considered payable by a pension entity, or a master pension entity, in respect of a supply
Pension rebates
Time limits
Ensuring an employer does not remit tax for, and preventing a pension entity from realizing the benefit of an input tax credit rebate on, the same supply twice through the issuance of tax adjustment notes
Transition adjustments for pension entities that are Selected Listed Financial Institutions

GST/HST Notice 348 – Information Requirements Related to Delayed Assessments of Participating Employers of Pension Plans (Subsection 172.1(8.01)) sets out the information a participating employer must provide to each pension entity that is deemed to have paid tax in respect of a supplied property or service. That is, the pension plan is deemed to have paid the difference between the tax assessed and the tax already accounted for in respect of the deemed supply. When all conditions are satisfied, providing this information will extend the two-year time limit for a pension entity to claim a rebate in respect of taxes deemed paid.

UPDATED CRA RECORDS GUIDANCE

The Canada Revenue Agency (CRA) has revised its guidance (last updated in 2005) on General Requirements for Books and Records, and Electronic Records. Key takeaways include the following:

The six-year records retention requirement in the Excise Tax Act applies to records retained electronically
Records kept outside Canada and accessed electronically from Canada are not considered to be records kept in Canada; backup copies should also be maintained at a location within Canada
Best practices for digital record keeping must be followed, including use of secure cloud-based systems, regular data backups, and ensuring that records are stored in formats compatible with CRA audit tools
Where the records keeping function is contracted out to a third party, the person required to maintain the records remains responsible for ensuring their readability, retention and access

RPD UPDATES: SPECIMEN PLANS AND TECHNICAL MANUAL

The Canada Revenue Agency (CRA) has updated Newsletter no. 95-6R, Specimen Pension Plans – Speeding up the Process, which cancels and replaces the previous version from 2016. The “Amending an approved specimen” section has been updated to clarify that an amendment request must include a consolidated plan text with the proposed changes.

The CRA has also updated Chapter 11 of the Registered Plans Directorate Technical Manual (8503(4) to 8503(26) – Additional Conditions) to improve its clarity and usability. These changes are based on industry feedback.

Any article or other information or content expressed or made available in this Section is that of the respective author(s) and not of the OBA.

What’s New in Pension And Benefits – Fall 2026