Resuming Contributions for Plans with Excess Surplus

As mentioned above, if a plan with an ESR below 1.05 is currently taking a contribution holiday, the plan administrator and the employer may be asked to resume current service contributions to the pension fund.

If the last actuarial valuation report filed for a plan indicates that the plan had excess surplus, contributions made to the plan may not qualify as prescribed contributions under subsection 8516(2) or (3) of the Income Tax Regulations. These subsections deal with contributions made to a plan on a termination basis or as required by pension benefits legislation. To determine the requirements of the Canada Revenue Agency in those circumstances, please contact the Registered Plans Directorate of the Canada Revenue Agency. OSFI expects plan administrators to make reasonable efforts to ensure that required contributions are made to the plan.