Please click the links below to find out more information about each topic. Note that, by default, property division on marriage breakdown in British Columbia does not apply to unmarried couples. However, common-law and same sex couples can opt into the property division provisions of British Columbia’s Family Relations Act.
For information on our services and fees, click here.
Pension valuations
Pensions are often people’s most valuable asset, and are considered to be a family asset under the Family Relations Act of British Columbia.
Defined benefit pensions are complex assets and can be difficult to deal with on divorce. There are two fundamental issues to consider: the mechanisms available to actually divide the pension and whether these mechanisms divide the pension fairly.
Pension Division
There are two primary mechanisms to divide a defined benefit pension: the actual pension payment can be split at retirement or a lump sum payment can be made from the pension plan to the non-member spouse. The law in British Columbia provides both of these options to spouses. In addition, the member spouse can “buy-out” the non-member spouse and not divide the pension at all. In order for a “buy-out” to occur, a fair value needs to be assigned to the pension (so the correct amount of the buy-out can be established).
Fair Value for the Pension
Assigning a value to a defined benefit pension is not a straight forward task (click here for more information). There are many different ways to value a defined benefit pension. This leads to much confusion when couples are attempting to assign a value to a defined benefit pension on marriage breakdown. Unlike most provinces in Canada, the law in British Columbia specifies how to value a defined benefit pension on marriage breakdown (in the Family Relations Act). This greatly simplifies the situation in British Columbia, however, couples should still be careful to ensure that they are assigning a fair value to the pension on marriage breakdown.
Foreign pensions/pensions from other provinces
In the case of foreign pensions, it is likely that an actuarial valuation by an independent actuary would be required. Actuaries can assist clients by valuing pensions from other countries and providing the lump sum value of a foreign pension in Canadian dollars and ensure that the valuation is in accordance with the law in British Columbia and the standards of practice of the Canadian Institute of Actuaries; this valuation will enable the couple to include the fair value of their foreign pension with the rest of their family assets.
Please read the information below and contact us if you have any questions.
- How are pensions in British Columbia divided on marriage breakdown?
- Supplemental pension plans are often overlooked
- Why should a defined benefit pension be valued by an actuary?
- Can we use the value of the pension provided by the pension plan administrator?
- Does the value of person’s pension assets need to be adjusted for income tax?
- Pension valuations frequently asked questions
- Information for RRSPs
- Information on our services and fees
Valuation of stock options and restricted stock units (RSUs)
Some employers provide stock option and/or restricted stock unit grants as part of an employee’s compensation. If stock options or restricted stock units have been granted during the period of marriage and have not been exercised at the date of separation, these options/units are generally considered a family asset and may need to be valued. For more information, click the link below.