85 Index or Index
The 85 index is used to determine if you will be eligible for an unreduced pension if you apply for a pension before age 65. It is calculated by adding together your age and your pensionable service at pension commencement. If your age plus pensionable service adds up to at least 85, or if you are at least age 65, you will receive an unreduced pension.
To accumulate over a period of time. For example, service accrues with each month worked.
The actuarial cost to purchase pensionable service is the cost which equals the value of the increase in pension benefit as calculated on the date of application. The purchase is cost neutral, resulting in no subsidized cost to you or the plan.
Assessment of the financial position of a pension plan by an independent actuary or actuarial consulting
Canada Pension Plan (CPP)
The federal pension plan administered by Service Canada. It applies in all provinces and territories of Canada except Quebec, where the equivalent Quebec Pension Plan applies.
A clear photocopy of an original document (such as a birth or marriage certificate, valid Canadian passport; or, Certificate of Canadian Citizenship) that has been certified by one of the following person(s): employees of ATRF, payroll personnel of your employer, notary public, lawyers, bank managers, police officers, doctors, MPs, MLAs; or, justices of the peace and judges.
The lump sum of money that needs to be set aside today, at current market interest rates, to provide your future pension payments. The lower the current interest rates, the higher the commuted value will be, because it is assumed that the amount today will earn less over your lifetime. Conversely, the higher the current interest rates, the lower the commuted value.
A pension that starts at some future date.
Defined Benefit Plan
A pension plan that provides a pension based on a benefit formula tied to your salary and years of service.
An estimate of your future benefit entitlement. As these estimates cannot account for future changes in your employment status, changes in legislation and other factors, the estimates are not guaranteed. No money is paid out on the basis of these estimates.
The cost of a pension plan's current and future benefit commitments (the amount required to pay for benefits that are currently being paid by the plan plus the amount required to pay for benefits that are expected to be paid in the future for pensionable service already earned).
Locked-In Retirement Account (LIRA)
LIRAs are restricted RRSPs that require that funds be used to provide a lifetime pension on or after age 50 but before the end of the calendar year in which you reach age 71. Most financial institutions offer LIRAs.
Old Age Security (OAS)
The basic federal income security program for seniors who are age 65 and older.
PAR (Pension Adjustment Reversal)
A pension adjustment reversal (PAR) measures the extent to which the RRSP deduction room for a pension plan member has been reduced by benefits deemed to have accrued under the pension plan but that will not be paid to the member.
For example, this can occur where an inactive member with less than five years of pensionable service elects a termination benefit. While the member's contributions and interest would be refunded, this refund may be less than the sum of all reductions to the member's RRSP deduction room since 1990. These reductions have been reported to Canada Revenue Agency by the member's employer on T4 slips and are commonly known as PAs or pension adjustments.
If these reductions to the RRSP deduction room exceed the amount of the refund, the difference is a PAR. The PAR is reported by ATRF to the former member and Canada Revenue Agency resulting in additional RRSP contribution room for that former member.
Under the tax rules, PARs are only to be calculated for former members who received a termination benefit since January 1997.
If the amount of a termination benefit is greater than or equal to the sum of all reductions to RRSP deduction room since 1990, no PAR will be generated.
Further information on PARs and RRSP contributions are available from Canada Revenue Agency.
Your pension option affects the amount of your monthly pension and the benefit paid in the event of your death after retirement. The pension option may guarantee a certain number of payments to your beneficiary or provide for the continuation of monthly payments after your death for the lifetime of another person (usually a spouse/pension partner).
Pensionable salary is salary used to determine your five-year average pensionable salary. It is limited to ensure that your benefit does not exceed the maximum benefit allowed by the tax rules.
Pensionable service is:
- service for which ATRF contributions were deducted;
- service purchased through ATRF; and
- service transferred from another pension plan under a reciprocal transfer agreement, provided that it has not been withdrawn.
Pensionable service includes contractual teaching service with the following schools, for which contributions have been made to ATRF and not withdrawn:
- school jurisdictions
- chartered schools
- specific private schools
The health-related portion of a maternity leave is considered to be pensionable service if ATRF contributions are deducted. Contact your employer to ensure contributions are deducted.
As of September 1, 1992, if you become disabled, you can continue to accrue pensionable service. See Becoming Disabled (in Life Events in the Teacher Group) for more information.
Pensionable service is credited according to service and salary information provided by employers and is rounded to four decimal places. For those plan members who are employed part-time, pensionable service is credited on a part-time basis. For example, a plan member employed for a full year on a halftime basis will be credited with 0.5 of a year of pensionable service.
Under the tax rules, a maximum of one year of pensionable service may be accumulated in any calendar year or school year.
Pensionable service determines your eligibility to receive an ATRF pension and is used to calculate your pension. Pensionable service can be accumulated:
- with no maximum, and
- to the end of the calendar year in which you reach age 71.
Plan Member Statement
A statement is sent annually to plan members who contributed to ATRF in the preceding school year. It summarizes pensionable service, contributions, interest and benefit entitlements.
The statement shows the following:
- the service reported to ATRF by an employer for the school year,
- the annual salary rate,
- the ATRF contributions deducted from salary paid,
- the interest credited by ATRF, and
- the benefits a plan member could have received if he/she had resigned at the end of the school year.
Registered Retirement Savings Plan (RRSP)
A retirement savings plan, approved and registered under the provisions of the Income Tax Act (Canada), under which taxes on the deposits and investment income may be deferred until the savings are withdrawn.
Salary is compensation for regular service, and includes administrative allowances, isolation pay, retroactive salary, and administrative vacation pay. It does not include car allowances, salary earned teaching night or summer school classes, early retirement incentives, or vacation payouts for administrative positions.
A member’s spouse/pension partner is a person who, on the relevant date, meets the definition under A or B below:
A) A person who is married to the member and has not been living separate and apart from the member for three or more consecutive years, or
B) A person who has been living with the member in a conjugal relationship for a continuous period of at least three years and was, during that period, held out by the member in the community in which they lived as being in that conjugal relationship.
Occurs when there are fewer assets in the fund than liabilities. See
TPP Unfunded Liability, in the Corporate Group (Funding the Plan > TPP Unfunded Liability) for more information.
The year's maximum pensionable earnings as determined by the Canada Pension Plan.