Date: November 5, 2015
To: All Participating School Boards and Principals
From: Howard Van Mersbergen, Executive Secretary-Treasurer
Canada Revenue Agency legislation requires each employer participating in the Canadian Christian School Pension Plan to report a Pension Adjustment (PA) for each employee who accrued benefits under the Plan during the previous calendar year. The PA must appear on the participant’s T4 slip, and an accompanying report must be filed by the last day of February following the taxation year.
* As in prior years, a modification to Pension Adjustment calculations will need to be made for participants who have worked at two different schools that participated in the Canadian Christian School Pension Plan during the year.
* Reporting for 2015 is required by February 28, 2016, and is based on the pension accruals for calendar year 2015. The 2015 pension accrual is based on covered earnings paid in calendar year 2015. Accordingly, it is necessary for each participating Board (or its designate) to understand and complete the calculations and recordkeeping to ensure accurate reporting for 2015. The reported Pension Adjustment will reduce the participant’s overall personal Registered Retirement Savings Plan (RRSP) contribution room dollar-for-dollar. It is therefore important that the necessary calculations be completed accurately.
* To assist you in the calculations of PAs, we have posted each of the Plan exhibits on our website: www.CSIonline.org/benefits under Canada Pension, Updates. The exhibits include the Pension Adjustment Formula for the Canadian Christian School Pension Plan and Sample Calculations 1-4 for each of the Contribution Plans (e.g. 5.55% Plan; 7% Plan; 8.05% Plan; schools that change from the 5.55% Plan to the 7% Plan; and schools that change from the 7% Plan to the 8.05% Plan).
Schools that change from the 5.55% Plan to the 7% Plan
Schools that change from the 7% Plan to the 8.05% Plan
* If you have any employees who received Short Term Disability or Long Term Disability benefits in 2015, include the period of disability in calculating the Pension Adjustment. It is important in the calculation to include the amount the employee would have earned if they had not been on disability. Note: Do not include the period of disability if your school is not in the CSI Canada Insurance Plan and your school did not elect to continue pension contributions for an employee on disability.
* Please note the following:
- The $600 offset in the formula still applies. Participants who transfer to/from a school that participates in the Canadian Christian School Pension Plan will have the $600 offset prorated. If the participant did not participate in the Plan at another school in 2015, the $600 offset should not be prorated. Participants who work less than fulltime will receive the full $600 offset unless they worked at a second school participating in the Plan during 2015. See the exhibits for more information.
- If a participant terminated employment during 2015, the Pension Adjustment for this participant must still be determined.
- In no event shall the Pension Adjustment reported be higher than $24,770 for 2015.
* The Canadian Christian School Pension Plan registration number with Canada Revenue Agency (0283812) must also be printed on the T-4. Instructions as to where to print the PA and the Plan’s registration number on the T-4 are included in CRA’s employer’s guide that should be available from your local district tax office.
* Since an historical record of Pension Adjustments must be kept, please send a listing to our office in February 2016 showing the name, social insurance number and 2015 Pension Adjustment amount for each Pension Plan Participant on your 2015 payroll. This information will be used in the future to calculate Pension Adjustment Reversals and to determine if plan design and benefit changes comply with government regulations.
Contacting Us for Support
More information about our benefit plans and past Updates are located on our website at www.CSIonline.org. Select Employee Benefits and the appropriate plan. As always, if you have questions, please contact Marcy Sterken or Anita Veldhuizen at 877-274-8796, extension 231 or 616-284-3231, or by e-mail at csipensionplan@CSIonline.org.