Starting or ending a relationship in retirement
Retirement is a big life change, and with that sometimes comes the end of a relationship or possibly the beginning of a new one. No matter your situation, it’s important to know how such changes can affect your pension.
If you marry or are legally considered to be in a common-law relationship after your pension starts, you can apply for a survivor pension for your new spouse if you don’t already have an eligible spouse or child who is entitled to receive a survivor pension.
If you're ending a relationship, it can impact your PSPP pension. It’s a good idea to understand the details of how your pension fits into the division of your assets.
The division of your pension is not mandatory under either the new rules that were established for separation agreements signed and dated on or after January 1, 2012 (or the rules that were in effect before January 1, 2012). It’s important to know the rules on how pensions are valued and divided when you’re going through a breakup so please feel free to contact us.
Ending a spousal relationship in retirement
What happens if I’m going through a breakup in retirement?
Please let us know if your relationship status changes. You can do that by updating your personal information using the OPB1004 – Retired Member Information Change (PDF) form, or you can call us.
Do I need to divide my pension with my former spouse?
Pension division is not mandatory when you end a spousal relationship. You and your former spouse can decide whether or not your pension should be part of the equalization of your net family assets when your marriage or common-law relationship ends.
If your pension is divided, your former spouse is entitled to a maximum of 50% of the family law value (during the time you were married or together as common-law) which they would receive as a monthly PSPP pension payment.
How does the pension division process work?
Dividing your pension after you end a spousal relationship is a four-step process. As part of the process, we will calculate your family law value so that you and your former spouse can determine if pension division is the right choice for you.
We have summarized the process below, including any necessary forms you’ll need to complete.
1. The application
If you and your former spouse were legally married, your application can be submitted by you, your former spouse or a person holding power of attorney for property for either you or your former spouse. For common-law relationships, only the retired member or his or her power of attorney for property can apply for a family law value. Please complete and submit the applicable forms and required supporting documents to us to get the family law value:
- FSCO Family Law Form 1 – Application for Family Law Value (required in all cases); and, if applicable, FSCO Family Law Form 2 - Joint Declaration of Period of Spousal Relationship. This second form only needs to be completed if there is not yet a court order, divorce decree or separation agreement with a start and end date. If there is no start or end date, then we will need documents that provide proof of both (i.e., marriage certificate or divorce certificate/separation agreement),
- Other required documentation we have included on the checklist for retired members.
The FSCO Family Law Form 3 – Contact Person Authorization is an optional form.
Once we receive your forms and required supporting documents, we can calculate the Family Law Value.
Important: Sending in your application does not mean that we will divide your PSPP pension automatically. It’s just the first step. The final decision to divide your pension is made by you and your former spouse once you have the information you need to make a decision. Your decision must be documented in your separation agreement, court order or other domestic contract.
2. Calculating the Family Law Value
Once we have calculated the family law value, we’ll prepare and send copies of the FSCO Family Law Form 4E – Statement of Family Law Value (Retired Member with a Defined Benefit Pension) to you, your former spouse and any contact person you and your former spouse may have designated within 60 days of receiving the completed application.
3. Review and make a decision
Once you receive the family law value package from us, you should take time to review the information with your legal counsel to determine if you are going to split your PSPP pension with your former spouse. Once you have made your final decision, please complete the appropriate forms and submit them and the supporting documents requested in the family law value package to us.
The family law value package will include the following:
- FSCO Family Law Form 6 – Application to Divide a Retired Member's Pension
- FSCO Family Law Form 7 – No Division of Family Law Value/Pension Assets
- Canada Revenue Agency Form TD1 E – Personal Tax Credits Return
- Canada Revenue Agency Form TD1ON E – Ontario Personal Tax Credits Return
4. Making an election
If you have decided to go ahead with dividing your pension, your former spouse needs to complete and submit a FSCO Family Law Form 6 – Application to Divide a Retired Member's Pension with a copy of your signed separation agreement, court order or other domestic contract to us.
If you’ve decided not to go ahead with dividing your pension, we ask that you and your former spouse sign and submit a FSCO Family Law Form 7 – No Division of Family Law Value/Pension Assets to us.
Once we receive your election form along with all other required forms and supporting documents, we’ll do the following:
- If we receive a FSCO Family Law Form 6, we will proceed with the pension division and notify you and your former spouse,
- If we receive FSCO Family Law Form 7, we will update your file to reflect that no decision was made
For more information on how you can send us these forms, please contact us.
Starting a new relationship in retirement
If I start a new spousal relationship in retirement, will my new spouse receive a survivor pension?
It depends. If you marry or are legally considered to be in a common-law relationship after your pension starts, you can apply for a survivor pension for your new spouse, but only if you don’t already have an eligible spouse or child who is entitled to receive a survivor pension when you pass away.
Important: If your application is approved, a reduction will be made to your pension to cover the cost of the survivor pension.
To apply for a survivor pension for your new spouse, you will need to let us know in writing and submit all supporting documents within 90 days of the later of:
- establishing a spousal relationship
- the date your children no longer qualify for a survivor pension
If your application is received after 90 days, a certificate of good health and medical assessment may be required to assess your eligibility.
If I start a new spousal relationship in retirement after a breakup, can the survivor pension go to my new spouse?
If your former spouse is entitled to a survivor pension, you cannot transfer that entitlement to your new spouse even if your former spouse waives his or her right to the survivor pension. For more details on that process, please call us.
What can I do to provide for my new spouse?
If your former spouse remains eligible for the survivor pension, you should consider what other assets are available to you and develop an effective financial plan that ensures they’re protected if you pass away first.
Takeaways and advice
No matter how your relationship status changes, you should notify us and get help to understand how those changes may impact your pension and estate planning.
You need to take into account how a division of assets could affect your retirement income and how you may need to manage your income if you’re also supporting a new spouse.
Please contact us to get more information about the family law value.
For more information about pension division rule changes after January 1, 2012, check out How changes in your life impact your pension.
To help you keep track of the documents you need to submit with your family law value application, check out the checklist for retired members (PDF).
If you are going through a separation or divorce, the Government of Canada has helpful information – check out canada.ca for more details.