RCA Tax deductions and Transfers

Whether you are considering transferring your RCA benefit or deducting your past Public Service Supplementary Benefits Account (PSSBA) contributions, please speak with a tax advisor/specialist for any specific questions.

Tax Deductions

OPB understands that, under s.60(t) of the federal Income Tax Act (ITA), the following contributions, which were not deductible at the time they were made, may be deductible from RCA benefits paid to retired members as part of their pensions:

  • contributions made to the PSSBA before 2022; and
  • contributions to the RCA that were not matched by the employer and were therefore not deductible in the year that they were made (these are receipted at the time of the contribution using Form 1170).

Claiming your deductions with the Canada Revenue Agency (CRA)

  • When filing your T1 “Income Tax and Benefit Return”, we understand that retired members should enter the deduction for past PSSBA contributions on line 23200 of their tax return.
  • In the space on line 23200 marked “Other deductions (specify):”, retired members should indicate the nature of the deduction (e.g., “RCA deduction s.60(t)”).

In any year, the maximum permitted deduction of PSSBA and RCA contributions that were not deductible in the year they were made is the lower of:

  • the amount of RCA benefits included in the member’s income in the year; and
  • the total amount of PSSBA contributions that has not been claimed in previous years.

Members must ensure that the total amount deducted from RCA benefits in all years does not exceed the total amount of PSSBA and RCA contributions that were not deductible in the year they were made.

Tax Records

Please should keep records of the following tax records in case they are requested by the CRA:

  • the amount contributed to the PSSBA (we will provide members with these records);
  • RCA contributions that were not deductible in the year they were made (provided by us on Form 1170); and
  • amounts of these contributions that are deducted from RCA benefits in each year.

If you have any questions about how, or when, you should be receiving these records from us, please contact us.

If you are currently a retired member who is interested in RCA tax deductions, please seek appropriate advice about your individual situations.

If you are currently an active member (not currently planning an imminent retirement) there is nothing you need to do at this time. But, if you are retiring soon and have questions about your pension, please contact us toll-free at 1-800-668-6203 or 416-364-5035 or email us at clientservice@opb.ca. We’re available Monday through Friday, 8 a.m. to 5 p.m. Please have your OPB client number on hand to help us serve you faster.

Transfers

By transferring your RCA, you can maintain the tax-sheltering of your benefits. Some of those ways include:

Reciprocal Transfer Agreement (RTA)

A member transferring credit into the PSPP under an RTA may obtain RCA benefits corresponding to that credit by transferring credit from an RCA associated with the exporting plan.

Major Ontario Pension Plans

The RCA Plan Text permits a member to purchase RCA benefits for credit that is transferred into the PSPP from CAAT, HOOPP, OMERS, OTPP or the OPSEU Pension Plan, provided that the member:

  • has benefits in a supplementary plan corresponding with the exporting plan;
  • cannot carry out an RCA-to-RCA transfer for reasons beyond their control; and
  • pays into the RCA the full actuarial value of RCA benefits corresponding to credit transferred into the PSPP.