How Is a Pension Divided When a Marriage Ends in Ontario?

How a workplace pension is valued and shared depends on the type of plan and your facts, so it is worth confirming with a lawyer how it applies to you.

For married spouses, property is generally sorted out through equalization. Each spouse values property owned on the separation date, less debts and excluded property, then subtracts net property owned on the marriage date. The spouse with the larger net family property pays half the difference, and a negative share counts as zero. Gifts and inheritances (other than the family home), life insurance proceeds received because someone died, personal injury money and property excluded by agreement are not shared. Common-law partners are not legally required to split property acquired while living together, though they may recover contributions to the other's property.

A court claim for an equalization payment must be started within six years of separation or two years after the divorce is final, whichever comes first. If you also have an RRSP, it can be transferred tax-free to a spouse's or former spouse's RRSP or RRIF if you are living separate and apart and the transfer is made under a court order, judgment or written separation agreement.