Before Retirement
If you die before retirement, the Plan provides a pre-retirement death benefit, equal to the market value of your pension account, payable to your spouse. If you do not have a spouse or if your spouse has waived their right to the pre-retirement death benefit, the benefit is paid to your designated beneficiary(ies) or estate.
Your spouse may choose to receive the pre-retirement death benefit in the form of any of the termination or retirement options that were available to you as a member of the Plan. Refer to Leaving UBC for a description of the options.
Death benefits payable to an individual(s) or organization(s) other than a spouse must be paid as a lump sum and are subject to taxation. The lump sum is fully taxable to the recipient(s) in the year when it is received.
For Canadian residents, the withholding tax rate is between 10% and 30%. In Quebec, the rate is between 5% and 15% plus provincial withholding tax.
|
Lump sum death benefit payment amount: |
Withholding tax rate (except Quebec) | Withholding tax rate in Quebec |
|---|---|---|
| Up to $5,000 | 10% | 5% |
| Between $5,001 and $15,000 | 20% | 10% |
| More than $15,000 | 30% | 15% |
If the recipient(s) is not residing in Canada at the time of the benefit payment(s), tax withheld is based on their country of residence, at a fixed rate of 25% or lower if there is a tax treaty.
The above rates are set by the Canada Revenue Agency. These rates do not represent the actual tax that may be owed by an individual. Taxes owing is determined by individual’s personal tax rate when filing their tax return for the year in which the benefit payment(s) is received.
Death Notifications Before Retirement
If you were an active member of the Plan prior to your death, your spouse, beneficiary(ies) or executor should notify your department, as well as the Plan of your passing.
If you were a deferred member of the Plan prior to your death, your spouse, beneficiary(ies) or executor should notify the Plan of your passing.
Death notifications can be made by calling Sun Life at 1-844-822-3131, Option 2 for Faculty Pension Plan (FPP) Accounts.
Upon notification of death, Sun Life will be in contact with your spouse, beneficiary(ies) or executor.
After Retirement
Any benefits payable from the Plan upon your death are determined by the retirement income option(s) you elected when you retired and started your pension income.
Death Notifications After Retirement
If you were retired and in receipt of pension income payments prior to your death, death notifications can be made by calling Sun Life at 1-844-822-3131.
Option 3 for RRIF/LIF-Type Payment Accounts
Option 4 for Variable Payment Life Annuity (VPLA) Accounts
Upon notification of death, Sun Life will be in contact with your spouse, beneficiary(ies) or executor.
The Member Services Team at the Pension Administration Office will be available to assist in completing the necessary forms.