Marriage Breakdown Pension Valuations
In Canadian jurisdictions, pensions are typically considered to be “property” (not “income”) under family law. When a marriage ends, the family property, as a general rule, must be equalized or divided. This does not mean that the pension (or any other individual asset) must be split in half. In some provinces, pensions are rarely divided. In other provinces, pensions are almost always divided. Regardless of which settlement approach is used, it’s usually a good idea to find out the value of the pension before decisions are made.
We have extensive experience calculating the value of pension assets for property equalization purposes subsequent to a marriage breakdown. The basic information required to prepare a pension valuation is as follows:
· The dates of birth of the plan member and the spouse
· The dates of marriage and separation
· A copy of the annual pension statement for the year-end closest to the separation date
· A copy of the pension plan’s standard “marriage breakdown” letter, if available
· Status of the plan member at the date of separation (actively at work, retired, on disability leave, etc.)
We may, in certain situations, require additional information. If this is the case, we will advise you.
As of 2012, the rules concerning pension valuation and division in Ontario have changed. Click here to download the DJA Survival Guide for more information.
The Supreme Court of Canada (in its Boston v. Boston decision) ruled against “double-dipping” in most cases. This means that if a pension is equalized or divided as part of family property, it cannot then be considered as income for the purpose of determining support obligations. If there is a dispute concerning support obligations either before or during retirement, we can determine how much of the pension has been equalized and how much has not been equalized. We can also calculate the retirement income that the non-member spouse should be able to realize from the equalization settlement that they received in place of a pension division.
Spousal or Child Support Buyouts
Some couples want a clean and permanent break after their divorce. If the parties want to negotiate a lump-sum settlement of future support obligations, then we can determine the amount of the lump sum.
Copyright 2012, Dilkes, Jeffery & Associates, Inc.
DILKES, JEFFERY & ASSOCIATES, INC.