A RRIF-Type payment is similar to an external Registered Retirement Income Fund (RRIF) but assets remain under the UBC Faculty Pension Plan.
You may use all or part of your non locked-in account balance to set up an income stream to meet your personal needs. The payments can be set up for any amount over the applicable statutory minimum.
The minimum required amount of withdrawal is based on your age as of January 1st each calendar year. Alternatively, you may use your spouse’s lower age, if applicable, to determine the minimum payment required and potentially reduce your tax obligation.
Please review the RRIF-Type Payments Information Sheet to gain a comprehensive understanding this retirement benefit option. As the assets remain under the UBC Faculty Pension Plan, you will continue to control the investment of your account, benefit from the low fee structure of the UBC FPP investment funds and no administration fees.
You may also choose to collapse your RRIF-Type payments agreement to purchase another retirement product, either externally or within the Plan, in the future.
The Retirement Income Estimator tool can be used to produce estimates of RRIF-Type Payment option, as well as the other options from the UBC retirement plans. To access the Retirement Income Estimator, sign in to your account at mysunlife.ca/ubcfpp, then under Investments, select Manage Plan > my plan > Tools > Retirement Income Estimator.
Tax Implications
Pension income is considered taxable income in the year that they are received and taxes will be withheld at source. Scheduled periodic payments (i.e. monthly, quarterly, semi-annually) will be annualized for the purpose of determining the withholding tax rate for each periodic payment. 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.
| Annualized Payments | 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% |
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 plan member. Taxes owing is determined by the plan member’s personal tax rate when filing his or her tax return for the year in which the benefit payment(s) is received. You may also request that additional taxes be withheld.
If you are not residing in Canada at the time of the benefit payment(s), tax withheld is based on your country of residence, at a fixed rate of 25% or lower if there is a tax treaty.
Consider All Your Options
Prior to selecting any retirement option, we recommend that your review all of your options.
If you are under age 55:
If you are over age 55:
Forms Required
The following forms must be completed and submitted to the Pension Administration Office before RRIF-Type payments can be initiated. You may also use the Retiree Checklist to assist you in completing your application.
For payment method, complete:
- Direct deposit enrolment form (Canadian banks only), or
- Request for benefit payment by wire form
A proof of age document for both you and your spouse (if applicable). Accepted documents include:
- BC Driver’s License and Services Card* (combined)
- BC Photo ID Card*
- BC Services Card*
- Birth Certificate
- Canadian Citizenship Card (issued prior to February 2012)
- Driver’s Licence* (regular or enhanced)
- Nexus Card*
- Passport*Permanent Resident Card*
- Secure Certificate of Indian Status*
*All asterisked documents must have a valid expiry date (not expired) at the time of submitting your documents.
If you are a non-resident of Canada, please complete a Form NR301, Declaration of eligibility for benefits (reduced tax) under a tax treaty for a non-resident person.
Death Benefits
In the event of your death, your spouse may continue to receive RRIF-Type payments or elect another termination/retirement option under the Plan. If you do not have a spouse, the market value of the pension account is paid to your designated beneficiary(ies) or estate in a lump sum.
Submitting Your Forms
Please submit your forms to the Pension Administration Office 4 to 6 weeks prior to your first payment date. You will receive a Welcome Letter from Sun Life after your RRIF-Type Payment account has been set up.
If you require assistance, please contact us.