Crossing Year-End Reminder

Missed Contributions

Pension Plan

The employer, as plan administrator, is responsible for following Federal legislation requirements and handling all calculations prior to contacting Sun Life:

Permitted Corrective Contribution

Permitted Corrective Contribution: Other Information

Once the legislation requirements have been met, please reach out to your designated contact and provide the following information:

• Member Name(s) and Member ID(s)
• Correct amounts by employee/employer
• Date each payroll deduction should have been sent to Sun Life
• Whether the contribution amounts were deducted from the members’ pay
• If the T4s issued for the impacted tax years include the correct amounts that should have been remitted

*Processing will be based on the Income Tax Act. Sun Life will have to review the legislation jurisdiction prior to proceeding.

Missed Contributions

Deferred Profit Sharing Plan

If the catch-up contribution is for 2024 or prior, the Registered Plans Directorate (RPD) will permit the contributions to be made provided certain requirements are met:

• The missed contributions must be allocated to the member's account in the current (or future) years,
• The missed contributions are subject to the particular year's pension adjustment limits, and
• The plan text permits these "catch-up" contributions

Once the RPD guidelines have been reviewed, please reach out to your designated contact and provide the following information:

• Member Name(s) and Member ID(s) impacted
• Correct amounts by employee/employer
• If the T4s issued for the impacted tax years include the correct amounts that should have been remitted

*Processing will be based on the Income Tax Act. Sun Life will have to review the legislation jurisdiction prior to proceeding.

Over Contribution

Pension Plan

The employer, as plan administrator, is responsible for following Federal legislation requirements and handling all calculations prior to contacting Sun Life:

Pension Adjustment Correction (PAC)

Pension Adjustment Correction: Other Information

Over-contributions to the DCPP longer than 10 years ago:

Canda Revenue Agency (CRA) approval, as well as Provincial approval may be required. Please reach out to CRA with details regarding the members affected, the years impacted, and the amounts of the over-contribution for guidance on how to complete the correction.

Once the legislation requirements have been met, for over-contributions to the DCPP within the last 10 years, please reach out to your designated contact and provide the following information:

• Member Name(s) and Member ID(s)
• Overcontribution amounts by employee/ employer
• Date each payroll deduction was sent to Sun Life
• If the T4s issued for the impacted tax years include the overcontributed amounts

*Processing will be based on the Income Tax Act. Sun Life will have to review the legislation jurisdiction prior to proceeding.

Over Contribution

Deferred Profit Sharing Plan

Over-contributions to the DPSP; and Sun Life notified before January 31, 2025:

Provide the following:

• Member Name and Member ID
• Correct amounts by employee/employer
• Date each payroll deduction was sent to Sun Life
• The required details based on Option 1 or Option 2, as applicable

Based on the Government of Canada income tax regulations 8301 (2) and (2.1). Depending on when you make your request and the plan member’s pension credit, here’s what you’ll need to do.

Option 1

For overcontributions made within a calendar year, if you request a refund by the end of January of the next calendar year, there are three requirements you’ll need to confirm within the refund request you send us:  

1. The plan member’s pension credit is equal to or less than 50% of the money purchase limit for the calendar year.
2. The plan member’s pension credit is greater than 18% of the amount that would be their compensation for the calendar year (as defined in subsection 147.1(1) of the Income Tax Act (excluding paragraph (b) of that definition).
   
3. The plan member’s pension credit is equal to or less than 18% of the amount that would be their compensation for the preceding calendar year as defined in subsection 147.1(1) of the Income Tax Act (excluding paragraph (b) of that definition). 

Option 2

Option 2 applies to:

• Requests made after the end of January of the next calendar year
• Requests that don’t meet all three requirements (listed in option 1, above)

In either of these two situations, please send a letter to the CRA Registered Plans Directorate (RPD) to explain the reason for the overcontribution so that the CRA can work with you to bring your plan back into compliance. Depending on the reason for the excess contributions, the CRA may allow (on an administrative basis) a refund of the excess contributions. To write your letter, you may want to consult a legal or tax professional.

When your letter is complete, please mail it to:

Registered Plan Directorate
Canada Revenue Agen
cy875 Heron Road
Ottawa, Ontario
K1A 0L5

If the CRA approves the refund of the overcontribution, please include their written response when you send us your refund request. 

Over-contributions to the DPSP; and Sun Life notified after January 31, 2025:

Based on the Government of Canada income tax regulations 8301 (2) and (2.1). Depending on when you make your request and the plan member’s pension credit, here’s what you’ll need to do.

Option 1 – not available

Option 2 – You are required to send a letter to the CRA Registered Plans Directorate. See option 2 above.

Once you receive directions from CRA, please email Sun Life and include the following details:

• Member Name and Member ID
• Correct amounts by employee/employer
• Date each payroll deduction was sent to Sun Life
• The required details for Option 2
• The letter from CRA with the direction

All other products

Email your Sun Life representative with the following:

• Reason for the error
• Member Name(s) and Member ID(s) impacted
• Products / Policies impacted
• Amounts by employee/employer impacted
• Date each payroll deduction was sent to Sun Life

Your dedicated representative will review your request in accordance with the Income Tax Act and will provide guidance on next steps.