Don’t Miss Out On Million Dollar Pensions!
Lorne MacLean, QC just chaired an excellent Pacific Business Law Institute conference for lawyers, accountants and financial planners on “the Grey Divorce” and explained a number of high net worth family property division issues. One of the hot topics at the conference was BC Supplemental IPP Pension Plan Division as well as the pitfall laden area of family pension division.
Our BC high net worth divorce and BC supplemental IPP pension plan division lawyers know that certain types of high income employees can contribute to more than just their basic employment pension. Our BC Supplemental IPP Pension Plan Division lawyers also know that self employed spouses have access to Individual Pension Plans. Sadly, many times upon separation, these lucrative pensions are forgotten or ignored. If our spouse earns over $100,000 or owns a profitable business you need to search for these pensions. Hire a lawyer who knows about these specialized plans to avoid missing out on your fair share. Call us toll free 1-877-602-9900.
Pensions Can Be The Most Valuable Family Property
Pensions are often the largest single asset spouses have accumulated and these additional plans can have values of in excess of 1 million dollars. Upon separation it is critical that a Form P1 be filed immediately and your lawyer should request in writing full details of all pensions and ensure no beneficiary changes or elections occur before proper division. BC supplemental IPP pension plan division cases are tricky so make sure you hire a lawyer who deals with these matters routinely.
Contribution Statements Can Be Misleading
Watch out for errors in using a contribution statement which can dramatically understate the real value for purposes of a fair BC Supplemental IPP pension plan division.
Failing to hire a BC Supplemental IPP pension plan division Lawyers can have catastrophic results. Similar errors can be made for division of business owners IPP.
What Is A Supplemental Pension?
Supplemental pension plans for senior executives and high income earners are very popular and becoming routine for high net worth spouses. The reason for this is the limit on RRSP contributions for individuals in the higher income brackets because of the legislative ceiling imposed by the RRSP and pension limits. Supplemental pension plans are a way to increase the pension contributions.
Our new Family Law Act has specialized rules for diving these lucrative pension plans and you need a BC Supplemental, IPP Pension Plan Division Lawyer who knows what they are and how to get them together with any IPP pension plans properly valued:
Section 119 Supplemental pension plans
- Section 119 provides detailed rules governing the division of benefits that are supplemental to benefits in a local plan.
- Under the Family Relations Act, benefits in a supplemental plan are divided by the same rules that apply to extraprovincial plans – the former spouse is entitled to a share of the income stream when it becomes payable.
- The problem with this approach is that it is usually not possible to provide the former spouse with any security for that share and payment typically ends when the member dies.
- Under the Family Law Act, in contrast, if the pension has not yet commenced, the former spouse is entitled to take the share as a separate pension. If the pension has already commenced, then the same rules under section 117 that apply to pensions being paid under a local plan apply. It is also open to the administrator to consent to using any of the rules that would apply had the benefits been under a local plan.
- The spouse’s share of the supplemental benefits is subject to the same terms and conditions as the member’s share. If the member’s share is adjusted, suspended or terminated, the spouse’s share is adjusted, suspended or terminated as well. In these cases, recourse is provided in section 120.
The Family Law Act came fully into force on March 18, 2013.
This document was developed by the Ministry of Justice to support the transition to the Family Law Act. It is not legal advice and should not be relied upon for those purposes.
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The section adopts the BCLI Report recommendation.
Meet with a skilled MacLean Law BC Supplemental, IPP Pension Plan Division Lawyer today to protect your share in what could be your largest family asset.
