Contribution deductibility and employer requirements
On this page
This page describes the details around tax deductions on contributions and includes these topics:
Deductibility of Contributions
All required current service pension plan contributions made by a member are income tax deductible, within the limits imposed by the Income Tax Act.
What employers report
Employers must report the following information on the member's T4 slip:
- The total annual member contributions in the RPP contribution box, including
- those contributions made to the PSPP, and RCA contributions as long as the member’s share of the RCA contributions does not exceed the employer’s portion (e.g., RCA contributions will not be deductible where the members contributions are not matched by the employer, such as buybacks of special leaves), and
- any buy-back contributions that were paid in the same year through payroll deductions
- the PSPP registration number (Registration Number 208777), and
- the member's Pension Adjustment (PA) calculated by the employer.
Deductible contributions can be reported in Box 20 of members’ annual T4 slip. This is the same box used to report RPP contributions (i.e., PSPP contributions). Because the amount in Box 20 of the T4 slip will include both RPP contributions and deductible RCA contributions, employers must attach a letter to the employee’s copy of the T4 slip showing each amount separately. Please contact OPB for a copy of the letter.
Must Not Report
- Contributions that represent buyback contributions paid directly to OPB where members were provided with tax receipts directly from OPB.
Refer to CRA Pension Adjustment Guide(opens in a new tab) for more information regarding PA calculations.
When member contributions end
Members must cease to make contributions to the PSPP as at November 30th of the year in which they reach age 71