CRA Updates PSPA Guide T4104

The CRA has released an updated guide for Past Service Pension Adjustments (Guide T4104) which contains general instructions and information for pension plan administrators to calculate past service pension adjustments (PSPA). These PSPA calculations may be required for employees that are being provided with new lifetime retirement benefits or when existing benefits are improved for members.

The guide will provide information on the following:

• What is a PSPA
• How a PSPA arises
• How to calculate a PSPA
• How to report PSPA's

Common situations and examples are provided in the guide to calculate figures needed for PSPA, benefit increases that may be excluded when calculating pension credits, the two methods for calculating the PSPA amounts and special rules that may impact multi-employer plans.

This guide is important because the last time the CRA issued guidance on calculating PSPA's was in 1999, and the T4104 guide should be used to calculate PSPA's for any year until a new version is issued.

To view the new T4104 guide, click here.