What’s New in Pension and Benefits – Winter 2026

LEGISLATION

FEDERAL BUDGET BILL INTRODUCED

Bill C-15, Budget 2025 Implementation Act, No. 1, was introduced on November 18, 2025. It includes amendments to the Income Tax Act (ITA), Income Tax Regulations (ITR) and Excise Tax Act (ETA) to implement some (but not all) measures announced in the Federal Budget 2025, as well as some previously announced measures. Explanatory Notes for Bill C-15 are also available. These measures include:

ITA and ITR amendments to facilitate the handling of unclaimed property of unlocated members; these amendments generally follow the earlier proposed amendments, and will apply to amounts paid or transferred to an unclaimed property authority after December 31, 2026 (one year later than originally proposed)
Bare trusts (i.e., trusts that act as agent for their beneficiaries with respect to all dealings in trust property) will no longer have to file an annual trust return or be subject to the beneficial ownership reporting requirements in section 204.2 of the ITR (beneficiary disclosure in Schedule 15 to the T3 return); this amendment applies for taxation years ending after December 30, 2024
The beneficial ownership reporting requirements will also no longer apply to retirement compensation arrangements that supplement retirement benefits (supplemental pension plans) or to employee ownership trusts; these amendments will apply to taxation years ending after December 30, 2025
ITA amendments to allow a tax-deferred transfer of the commuted value of an annuity acquired in satisfaction of a member’s entitlement to benefits under an RPP, if the pension benefit is divided because of marriage breakdown or pension legislation permits the annuitant to commute or surrender the annuity (if the original annuity purchase is with respect to a DB provision, the DB transfer limits will apply to the indirect transfer from the annuity to other registered vehicles); this amendment is deemed to have come into force on January 1, 2018
Various amendments to the tax-free savings account and first home savings account provisions of the ITA and ITR, with different effective dates

Other 2025 Budget announcements not included in Bill C-15 include:

Simplifying and consolidating the qualified investment rules applicable to registered plans under the ITA
Funding the Business Development Bank of Canada to launch a new fund-of-funds to leverage more private venture capital from pension funds and other institutional investors
Offering a voluntary Early Retirement Incentive program under the Public Service Pension Plan so that eligible employees (with a minimum age of 50 or 55 depending on Group, and at least 10 years of employment and two years of pensionable service) can retire with an immediate pension based on years of service
Consulting on CPP and QPP enhancements so that federal employees will continue to receive the same pension benefits but will contribute less

CPP AND OAS AMENDMENTS NOW PERMIT DIGITAL PROVISION OF DOCUMENTARY EVIDENCE

Effective January 1, 2026, the Canada Pension Plan Regulations and Old Age Security Regulations were amended to modernize the application process for CPP and OAS benefits where evidence of age, identity, marital status or death is required, by enabling the use of digital technology. Applicants can now choose their preferred method of providing documentary evidence (i.e., in person, by mail, or by uploading an electronic copy through their My Service Canada Account).

These options have been available as a temporary measure since 2020 to address impediments caused by the COVID-19 pandemic. The Minister can still require original or certified copies of documents where wrongdoing is suspected.

ONTARIO BUDGET BILL INTRODUCED

Bill 68, Plan to Protect Ontario Act (Budget Measures), 2025 (No. 2) received Royal Assent on November 27, 2025. Amendments to the Pension Benefits Act provisions relating to jointly sponsored pension plans (JSPPs):

Enable plans that only provide defined contribution (DC) benefits to convert to a jointly sponsored pension plan (JSPP) and establish the rules for doing so, including allowing members to transfer their balances from the plan
Enable plans that provide both defined benefits and DC benefits to convert the defined benefits to a JSPP
Apply successor plan rules where a JSPP is established or amended to be a successor to an existing JSPP (and amendments to wind-up provisions relating to these successor plans)
Allow a member with DC benefits to require their plan administrator to transfer their DC assets into the JSPP, provided other requirements are met

Bill 68 also amends the Ontario Municipal Employees Retirement System Act, 2006 to abolish the OMERS Sponsors Corporation and replace it with a Sponsors Council, purportedly to enhance the OMERS plan’s governance, transparency and accountability. The changes follow a review of the OMERS governance structure by Robert Poirier, which issued its recommendations on November 5, 2025.

ONTARIO SLRA AMENDMENTS PASSED ON BENEFICIARY DESIGNATIONS

The Succession Law Reform Act was amended effective December 11, 2025 to permit a substitute decision maker of an incapable person (i.e., a guardian or person acting under a power of attorney) to designate the same beneficiary under a plan where the plan is being converted, renewed, replaced or transferred. This will accommodate situations where the new plan requires its own designation form. Plans include: pension, retirement, welfare or profit-sharing plans, or plans with respect to the payment of periodic sums, and include RRSPs, RRIFs, home ownership savings plans and TFSAs.

Like a regular designation, this designation can be made electronically in accordance with the Electronic Commerce Act, 2000.

ONTARIO ESA AMENDMENTS PASSED: LEAVES OF ABSENCE AND TEMPORARY LAY-OFFS

The Employment Standards Act, 2000 (ESA) was amended effective November 27, 2025 to add a new job-seeking leave. As a result, eligible employees can take up to three days of unpaid leave to look for a new job where they have been given notice that their current job will end as part of a mass termination provision (i.e., 50 or more employees are terminated within a four-week period). The ESA rules on pension and benefit continuation apply to this leave.

Also effective November 27, 2025, the number of weeks of temporary lay-off for non-union employees (i.e., the period an employee can be off work without triggering the ESA’s termination provisions) can be extended to 35 or more in any period of 52 consecutive weeks, provided it does not exceed 52 or more weeks in any period of 78 consecutive weeks, and the employer, employee(s) and Director of Employment Standards all agree.

REGULATORY UPDATE

MJPPA ADMINISTRATIVE PROCEDURES

The Canadian Association of Pension Supervisory Authorities (CAPSA’s) Administrative Procedures for the Amended Agreement Respecting Multi-Jurisdictional Pension Plans (Procedures) took effect on January 1, 2026. They outline how specific provisions of the Agreement Respecting Multi-Jurisdictional Pension Plans (MJPPAs) should be applied by participating pension supervisory authorities (PSAs) in seven key areas:

How PSAs should coordinate activities and communicate when making decisions and conducting appeals, including any modifications of the major authority’s procedures required for making decisions with respect to non-Schedule B (i.e., plan member) matters
The handling of unresolved disputes between PSAs, including notification of CAPSA members and confidentiality
How PSAs should provide information or other assistance among themselves
Ensuring members can communicate in the language in which the member has the right to communicate under the pension legislation applicable to that member, if the MJPPA did not exist (CAPSA notes that failure by a major authority to respect language rights could mean its communications are inoperative)
How a major authority should report to a minor authority with respect to plans whose members are subject to the minor authority’s legislation
How PSAs should communicate with plan administrators when certain powers are exercised, such as to split plan assets and liabilities
Providing examples of pending matters on a change of major authority status

REVISIONS TO OSFI’S SUPERVISORY FRAMEWORK

The Office of the Superintendent of Financial Institutions (OSFI) will revise its Supervisory Framework following a review by stakeholders. The Framework sets out how OSFI oversees federally regulated financial institutions, and private pension plans. OSFI will amend the Framework in phases over the 2026-2027 fiscal year by:

Ensuring more flexibility when applying the Overall Risk Rating (ORR), which going forward could be better than the weakest of the plan’s four rating categories (i.e., the “weakest link” principle)
Explaining how ORRs align with Intervention Stage Ratings
Adjusting the rating methodology to better distinguish between risk rating levels
Ensuring that integrity and security risks are more clearly identified
Clarifying that the absence of supervisory findings does not imply an absence of risk

OSFI will provide further updates as it implements these amendments.

UPDATE ON OSFI DATA COLLECTION MODERNIZATION INITIATIVE

The Office of the Superintendent of Financial Institutions (OSFI) has released an update on its Data Collection Modernization Initiative. All sectors will need to learn how to use the new data collection technology platform. Onboarding will occur between Fall 2026 and Spring 2028:

Step 1 (Fall 2026): New system is live; all sectors will establish credentials, validate corporate profile, and file corporate data
Step 4 (early 2028): Private pension plans will begin filing regulatory returns, beginning with “early adopters”

Ahead of each step, OSFI will communicate and provide training (see Table 1: Active DCM Engagement Chart with Timelines).

OSFI PLAN ASSESSMENT RATE SCHEDULES

The Office of the Superintendent of Financial Institutions (OSFI) has released its Pension plan assessment rate schedule under the PBSA (plan year ending between October 1, 2025 and September 30, 2026) and Plan assessment rate schedule under the PRPPA (plan year ending December 35, 2025), both unchanged from the previous year based on the previously announced Basic Rate of $12 per beneficiary. As a result, the minimum and maximum assessments for both types of plans remain $600 and $240,000 respectively. OSFI will determine the assessment due and send an invoice approximately 45 days after the plan’s Annual Information Return was due, or on receipt of an application for registration.

OSFI INFOPENSIONS ISSUE 33

The Office of the Superintendent of Financial Institutions (OSFI) has released InfoPensions – Issue 33. New announcements (not previously reported) include the following:

The maximum going concern discount rate will remain 6.75% for actuarial reports with a valuation date on or after December 31, 2025
Plan administrators should notify their plan fund trustee or custodian (through a revised contribution planner) when there is a significant plan change that decreases required contributions
The list of federally regulated private pension plans (which still excludes plans with fewer than 10 members) and the list of pooled registered pension plans have been moved to the Open Government website
OSFI expects to release the results of its online Pension Plans Survey next summer (the survey closed on December 12, 2025)
Various organizational and staffing changes are set out

RESCINDED OSFI GUIDANCE

Effective December 31, 2025, the Office of the Superintendent of Financial Institutions (OSFI) has rescinded the following guidance documents because they were outdated, redundant or no longer well-aligned with OSFI’s mandate:

Derivatives Sound Practices (2014) – Guideline Impact Analysis Statement
OSFI's Near-Term Plan of Prudential Policy for Federally Regulated Financial Institutions and Federally Regulated Private Pension Plans – Letter (undated)

OSFI ANNUAL REPORT AND DEPARTMENTAL RESULTS REPORT 2024-2025

The Office of the Superintendent of Financial Institutions (OSFI) has released its Annual Report 2024-2025. It includes funding, actuarial and investment information for federally regulated private pension plans (FRPPs) and (where relevant) pooled registered pension plans.

OSFI has also released its 2024-2025 Departmental Results Report, according to which:

Number of FRPPs for which the supervisory rating (risk level) increased by two or more levels within a three-month period was one or fewer (versus two during 2022-23)
OSFI Implemented Vu 2.0, its new supervisory system of record for pensions

FSRA PENSION UPDATE

The Financial Services Regulatory Authority of Ontario (FSRA) has released its latest Pension Update, which includes the following:

As of September 30, 2025, the median solvency ratio of defined benefit pension plans was 124% (up from 122% in the previous quarter)
FSRA has concluded a review of buy-out annuity discharge submissions, and is currently reviewing how incremental costs are reported on the Actuarial Information Summary
FSRA will summarize comments received during its recent consultation on proposed Target Benefits Supervisory Guidance
FSRA will engage with pension lawyers on key trends in transactions and persistent issues in transaction applications
Stakeholders are invited to apply to participate on a Pension Standing Technical Advisory Committee
Changes are planned for the surplus application information website
FSRA will launch a data clean-up initiative with respect to the Pension Services Portal, and will contact administrators to confirm and update data

FSRA’S PROPOSED PRIORITIES AND STRATEGIC PLAN

The Financial Services Regulatory Authority of Ontario (FSRA) has released its proposed 2026-2027 Statement of Priorities, which include:

Implementing the new target benefit pension plan framework, which took effect on January 1, 2025
Conducting the statutory review of the Pension Benefits Guarantee Fund
Developing a quasi-criminal enforcement approach to more effectively use its existing legislative authority

The Statement also sets out FSRA’s Five-Year Strategic Framework. Objectives include:

Developing purposeful cross-sector integration
Implementing a decision-making framework for principles-based, proportional, risk-based and outcomes-focused regulation
Implementing a FSRA-wide stakeholder engagement strategy

CASELAW

TFSA OVER-CONTRIBUTIONS

In Zazula v. Canada (Attorney General), the Tax Court of Canada rejected the taxpayer’s assertion that the Canada Revenue Agency should use the fair market value of investments in his tax free savings account (TFSA) to calculate any over-contribution owing, as they had declined dramatically in value. According to the Court, whether “an individual’s chosen investments decline or increase in their TFSA is not relevant to the calculation of an ‘over-contribution’ for purposes TFSA provisions” of the Income Tax Act.

AUTOMATIC OAS ENROLLMENT

In Abramowitz v. Canada (Attorney General), the Federal Court of Appeal rejected the Old Age Security (OAS) recipient’s assertion that his OAS pension payments had not begun because they were subject to 100% withholding. According to the Court, “payment and withholding, with a corresponding credit to his income tax installment account, is payment to the appellant”. In this case, the recipient had missed both the 90-day deadline to request a delay of automatic enrollment, and the subsequent six-month deadline to cancel the OAS pension (after receipt of the first monthly payment), and so his pension could not be suspended or delayed.

PENSION OVER-CONTRIBUTIONS

In Canada Post Corporation v. Canadian Postmasters and Assistants Association, Canada Post Corporation (CPC) sought judicial review of an Arbitrator’s decision, arguing that it had unreasonably been denied the right to seek recovery of overpayments of pension and other contributions made by mistake. In dismissing CPC’s application, the Ontario Superior Court of Justice refused to apply the Supreme Court of Canada decision in B.M.P. Global Distribution Inc. v. Bank of Nova Scotia involving monies paid under a mistake of fact. Although B.M.P. has been widely followed in civil cases, mainly regarding financial institutions, it has not yet entered the labour arbitration jurisprudence. The Court declined to apply it now, and also refused to comment on whether B.M.G. may apply in other labour contexts. Finally, the Court refused to permit CPC to raise unjust enrichment for the first time, when it could have done so before the Arbitrator.

LAWSUIT FILED AGAINST CPPIB INVOLVING CLIMATE-RELATED FINANCIAL RISKS

On October 23, 2025, a lawsuit was filed in the Ontario Superior Court of Justice against the Canada Pension Plan Investment Board (CPPIB) by four Applicants who will become eligible to receive Canada Pension Plan (CPP) retirement benefits after 2050, alleging a breach of statutory and fiduciary duties to manage and invest its assets in members’ best interests. The claim asserts that the CPPIB is underestimating the financial implications of climate change, misrepresenting the severity of climate risks to CPP funds, and worsening its harms by continuing to invest in the expansion of fossil fuel production, thus subjecting their contributions to undue risk of loss.

As relief, the Applicants are seeking a range of declarations, including that the CPPIB’s fiduciary and statutory obligations require identification, assessment and management of climate-related financial risk, and that it has breached those obligations. They are also seeking orders to disclose climate-related risk assessments.

TAXATION

CRA ANNOUNCES REGISTERED PLAN LIMITS, YMPE AND YAMPE

The Canada Revenue Agency has updated its chart setting out limits for registered plans and the Canada Pension Plan amounts (for 2026 unless otherwise indicated):

Money Purchase limit: $35,390
Defined Benefit limit: $3,932.22
Registered Retirement Savings Plan limit (for 2027): $35,390
Deferred Profit Sharing Plan limit: $17,695
Year’s Maximum Pensionable Earnings: $74,600
Year's Additional Maximum Pensionable Earnings: $85,000
Tax Free Savings Account limit: $7,000
Advanced Life Deferred Annuity limit: $180,000

UPDATED RC4137: PENSION ADJUSTMENT REVERSAL GUIDE

The Canada Revenue Agency has updated RC4137 Pension Adjustment Reversal Guide by adding new definitions and new Section 7, “What is a pension adjustment correction” (including new Example 13). Existing Section 8 has been renamed as “Reporting a PAR or PAC”, with corresponding edits. Pension adjustment corrections were introduced as part of reforms (passed in 2023 but made retroactive to January 1, 2021) allowing plan administrators to correct for DC over contributions returned to a taxpayer.

UPDATED CRA GUIDELINES FOR GROUP PLAN SPECIMEN APPROVALS

The Canada Revenue Agency has updated its guidelines for specimen approvals for the following group plans with mandatory participation, so that the signature of the annuitant or account holder is no longer required on the application:

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