How Are Pensions Divided Between Spouses in Ontario?
Pensions are not split asset by asset; they count as property in equalization, and the spouse with the lower net family property is entitled to one-half the difference. For pension rights, property includes the imputed value, for family law purposes, of the spouse's interest in the plan for the period from the date of marriage to the valuation date.
Property is defined broadly as any interest, present or future, vested or contingent, which can capture investments. Whether a particular savings plan counts as property, and how it is valued, depends on your situation, so it is worth confirming with a lawyer. Values are calculated as of close of business on the valuation date.
A court can order payment, payment in instalments or delayed payment for up to ten years if necessary to avoid hardship, and can order property transferred, vested, partitioned or sold. How a share of a particular pension is actually moved depends on the plan and on any agreement or order, so confirm the steps with a lawyer or the plan administrator. Gather your recent plan statements early, because they will help with valuing the plan.
Key takeaways
- For pension rights, property includes the imputed value of the spouse's interest in the plan from the date of marriage to the valuation date.
- Equalization is a payment of money, not a split of each asset.
- A court can order payment in instalments, or delay payment for up to ten years, if necessary to avoid hardship.
- Property is defined broadly enough to capture investments, though how they are valued depends on the facts.