Pensions

Pensions are often a very sensitive subject in property equalization discussions. Many clients are upset that they have to include an asset that they have worked so hard for. Some people don't realize their pension is matrimonial property and included in equalization of assets. However that is not the case. Pensions are considered matrimonial property and included as an asset for the purpose of calculating Net Family Property (NFP). Often pensions are a significant asset and in some cases the single largest asset after the matrimonial home. On January 1, 2012 new legislation was passed in Ontario Legislature that change how pensions are treated in equalization and who does the valuation. The new rules apply to provincial pensions under the Ontario Pensions and Benefits Act. Property Equalization Before the rule change, the value of a pension remained with the person who owned it. This treatment was unfair as the whole value of the pension could account for a large portion of one party’s equalization pot...
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