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Email this12:18 pm
June 15, 2016
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Loonie, If I may ask I'm looking at my estimate 1: June 30, 2016 pension calculation data and this is what is showing . Here how ( Omers ) we calculated your annual deferred pension . Your Omers lifetime pension plus bridge benefit is $29,594.69 . Less Omers bridge benefit is 9,010.31 . Total lifetime basic deferred pension from age 65 is $20,584.38 . Now correct me if I'm wrong but If I were to retire on June 30/16 I will receive every year 29,594.69 until I'm 65, afterwards I will get 20,584.38 plus my old age CPP government pension, what ever amount that might be, yes ? If I retire 6/30/16 I will have to claim every year on income taxes $29,594.69 until age 65, yes ? If this is correct, Do you have a rough idea how much I will pay in tax towards my yearly income of $29,594.69 ? I'm thinking instead of cashing out just retire and sell the home as is, pay the mortgage off, whatever I get from it I could just bank it in RRSP or whatever, yeah ?
1:33 pm
October 21, 2013
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local905 said
Loonie, If I may ask I'm looking at my estimate 1: June 30, 2016 pension calculation data and this is what is showing . Here how ( Omers ) we calculated your annual deferred pension . Your Omers lifetime pension plus bridge benefit is $29,594.69 . Less Omers bridge benefit is 9,010.31 . Total lifetime basic deferred pension from age 65 is $20,584.38 . Now correct me if I'm wrong but If I were to retire on June 30/16 I will receive every year 29,594.69 until I'm 65, afterwards I will get 20,584.38 plus my old age CPP government pension, what ever amount that might be, yes ? If I retire 6/30/16 I will have to claim every year on income taxes $29,594.69 until age 65, yes ?
If this is correct, Do you have a rough idea how much I will pay in tax towards my yearly income of $29,594.69 ? I'm thinking instead of cashing out just retire and sell the home as is, pay the mortgage off, whatever I get from it I could just bank it in RRSP or whatever, yeah ?
I believe the part I have put into bold face is correct, but I am not an expert on this. I am not sure what happens if you should get another job and want to discontinue or not even begin that bridged pension. Can you put it forward to 65? Please ask, as I don't know. Perhaps someone else here knows. You should confirm with OMERS that your understanding is correct. A phone call should do it. HR can probably even answer the question.
I would estimate that you would pay about 4,000 annually on income tax on approx. 29,500 to age 65, although you may have some additional tax credits.
Based on your question, I am rethinking what I said about RRSP. Stay tuned. I will look into it further.
2:03 pm
October 21, 2013
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Here is the link to the page where CRA talks about moving money from a pension plan to an RRSP. http://www.cra-arc.gc.ca/tx/nd.....a-eng.html
I have to admit that I find this a bit confusing, and I am not entirely clear if you could do this, or to what extent. Perhaps someone else will see it more clearly than I. Otherwise, you would need to call CRA and ask them and hope you get the correct answer. When calling CRA, it is best to call 3t times and ask the same question of different people. If they all agree, then the answer is probably correct. They don't have a good track record on correct responses unfortunately.
3:50 pm
September 11, 2013
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I'm not 100% but I think: The bold part is correct, except I believe the amounts will increase each year due to indexing. And once you "retire" (as opposed to "quit") your pension begins and you no longer can stop or defer it. You'd have to talk to HR to see if, based on your age and years of service, whether you still have the option to "quit" as opposed to "retire" - if so, you likely could defer your pension until as far away as 65. And, as you likely know, CPP can be taken anytime between ages 60 - 70 and OAS between 65 - 70, and those decisions have zero effect on your OMERS pension.
8:05 pm
April 6, 2013
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Loonie said
Here is the link to the page where CRA talks about moving money from a pension plan to an RRSP. http://www.cra-arc.gc.ca/tx/nd.....a-eng.html
I have to admit that I find this a bit confusing, and I am not entirely clear if you could do this, or to what extent. ….
It looks like he could do a direct transfer of the cash refundable part ($260,000) of the commuted value to a regular RRSP, without requiring any RRSP contribution room. This is from OMERS: First Steps After Leaving:
Refund or Transfer of Contributions
Elect a cash refund of the commuted value of your pension if your pension is less than 4% of $54,900*
You can take a cash refund of the commuted value of your benefit if the annual pension you have earned is less than 4% of $54,900*. You may also make a tax-deferred transfer of the cash refund to your RRSP.
*Year’s maximum pensionable earnings (YMPE) in the year you leave your OMERS employer – YMPE for 2016 = $54,900.
8:17 pm
April 6, 2013
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Loonie said
…
With only 8000 in your RSP, however, you probably could put an amount at least equivalent to most of your earnings from your job this year into RSP. This would be deductible from your taxable income this year, and would bring the tax bite down somewhat. I am not sure if you could use the amount from OMERs as well, but think you might be able to.Right now, can you take aa look at your most recent “Notice of Assessment” from CRA, which you would have received this Spring after you filed your taxes, and tell me how much “RSP contribution room” it says you have?
…
There's likely not much unused RSP contribution room. RSP contribution room would have been consumed each year by the value of the pension benefits earned that year.
That's done through the Pension Adjustment amount in Box 52 of the T4 slips and entered on line 206 of the tax return.
9:56 pm
October 21, 2013
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Norman1 said
Loonie said
Here is the link to the page where CRA talks about moving money from a pension plan to an RRSP. http://www.cra-arc.gc.ca/tx/nd.....a-eng.html
I have to admit that I find this a bit confusing, and I am not entirely clear if you could do this, or to what extent. ….
It looks like he could do a direct transfer of the cash refundable part ($260,000) of the commuted value to a regular RRSP, without requiring any RRSP contribution room. This is from OMERS: First Steps After Leaving:
Refund or Transfer of Contributions
Elect a cash refund of the commuted value of your pension if your pension is less than 4% of $54,900*
You can take a cash refund of the commuted value of your benefit if the annual pension you have earned is less than 4% of $54,900*. You may also make a tax-deferred transfer of the cash refund to your RRSP.
*Year’s maximum pensionable earnings (YMPE) in the year you leave your OMERS employer – YMPE for 2016 = $54,900.
That's what I thought too, when I read it. But, if that's the case, why is OMERS telling him that he has to take it in cash and pay income tax on it and even going so far as to estimate the income tax? Surely they would know if it could be transferred to an RSP? Or maybe he only asked them about how to get cash out of it?
I think he needs to ask this question directly, to be sure.
Putting it into RSP would be by far the best solution if he is determined to quit (not "retire"). He can still take out what he needs when he actually needs it if necessary.
10:02 pm
October 21, 2013
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Norman1 said
Loonie said
…
With only 8000 in your RSP, however, you probably could put an amount at least equivalent to most of your earnings from your job this year into RSP. This would be deductible from your taxable income this year, and would bring the tax bite down somewhat. I am not sure if you could use the amount from OMERs as well, but think you might be able to.Right now, can you take aa look at your most recent “Notice of Assessment” from CRA, which you would have received this Spring after you filed your taxes, and tell me how much “RSP contribution room” it says you have?
…There's likely not much unused RSP contribution room. RSP contribution room would have been consumed each year by the value of the pension benefits earned that year.
That's done through the Pension Adjustment amount in Box 52 of the T4 slips and entered on line 206 of the tax return.
When I was in OMERS (quite a few years ago now), I was able to contribute annually to RSP beyond what I had to contribute to OMERS. I think it amounted to about 60K over 9 years, but I'm just going on memory. It sounds like this man has been with the city quite a bit longer than that, considering the size of his OMERS pension, so he should have significantly more contribution room available.
The answer will be found on his most recent Notice of Assessment, so that is worth looking at.
However, if a direct transfer is possible, as in the previous post, then that would be easier and more certain to work.
5:24 am
September 11, 2013
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I haven't been following all the minutiae of this situation and I don't know if this applies but if he's been working for a while the portion of a "retiring allowance" (severance) for service prior to 1996 can, within limits, also be directly transferred to an RRSP above and beyond available contribution room.
6:55 pm
June 15, 2016
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I think I was hacked, somehow my password got changed and my report from Omers got changed as well, how or who done it is beyond me but now when I view my report its missing some fact numbers ...
Can someone explain this >>> Refund or Transfer of Contributions
Elect a cash refund of the commuted value of your pension if your pension is less than 4% of $54,900*
You can take a cash refund of the commuted value of your benefit if the annual pension you have earned is less than 4% of $54,900*. You may also make a tax-deferred transfer of the cash refund to your RRSP.
*Year’s maximum pensionable earnings (YMPE) in the year you leave your OMERS employer – YMPE for 2016 = $54,900.
My estimated commuted value of my persion is 473,587.77 ... Now The Income Tax Act (ITA) sets a variable factor to determine the limit on the amount you can tax shelter when you transfer the commuted value, please note that you can only transfer approximately $213,733.79 to a LIRA . This amount is an estimate only and will be recalculated as of the we pay it. Any commuted value amount over the limit will be sent to you in cash and income tax will be deducted .... So what are all the options I can do with this amount $259,853.98 ? . Is it possible to cash all of it ? Thanks.... And thanks everyone above as well ... Lastly is this site safe ? Since when I reformatted and reinstalled Firefox I got a warning pop up with this site, that and someone some how changed my login password
9:05 pm
October 21, 2013
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I am confused by this also, except to say that 4% of 54,000 is 2160. I presume this is to be understood as an annual figure, not a monthly one, since nobody would be getting 54,000 per month.
Since your pension, by any measure, is well over 2160/yr, and I think also well over 2160 even on a monthly basis (I believe you said 2800), I would think that none of this applies to you.
But I am not sure that I understand this correctly.
I have not had any security issues with this site. I have recently been getting a lot of "This page cannot be displayed', however.
I think you will need to clarify directly with OMERS and CRA what your options are as we are only getting snippets of the story. You need to be able to explain it in plain English, for your own good. Once you have done that, we may be able to help you decide which option is best and what to do with any money you may receive, if you still want help.
At the very least, you need a clear answer on whether there is any way that you can transfer the 260,000 to an RSP without tasking it out in cash first. OMERS will know if you can transfer it directly, because it would be up to them to do it. If they can't, then ask CRA if you could contribute some or all of the cashed out amount to an RSP and use it as an income deduction, and, if so, how much.
Don't be afraid to ask them a lot of questions until you are sure you understand. That's their job, and I don't think they will mind taking the time to explain.
Regardless, the short answer, as far as I am concerned, is: stay in your job until you get full pension, take a mental health leave, find a therapist, use the therapist to help you develop alternative coping strategies in regards to the job, learn to leave the job behind at the end of your shift and be happy in your spare time. If you are able to find another decent job, then do so and then consider taking early retirement from the current one and postponing your pension if you can. There is no guarantee that you will be happy if you quit, attractive as that may seem. If you quit now, with nowhere to go, you are going to lose income, no matter how you slice it, and it is going to hurt. And you may have 30 or more years in which to regret your decision.
If you take money out of OMERS, you will not only be worse off, you will have to learn to manage it. This is not easy, and there is the real possibility that you will lose money, as many people have. You have no skills or experience in this area. So, don't take it on. Sell the townhouse either with or without repairs, and buy a condo in a building with elevators and a realistic reserve fund.
9:48 pm
April 6, 2013
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local905 said
… Lastly is this site safe ? Since when I reformatted and reinstalled Firefox I got a warning pop up with this site, that and someone some how changed my login password
Norton Safe Web and Internet Explorer Microsoft SmartScreen report no problem with this site.
I also tried accessing this site from FireFox 47.0. No warning popup.
Do you remember what the warning popup was about? Maybe a browser add-on, extension, or plugin has a known security vulnerability and needs to be updated.
3:08 am
June 15, 2016
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Ok ... Yeah it might be a plugin has a known security vulnerability.
9:58 am
April 6, 2013
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One can check the add-ons, extensions, and plugins in FireFox by going to
Tools -> Add-ons
10:42 am
April 6, 2013
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local905 said
…
Can someone explain this >>>Refund or Transfer of Contributions
Elect a cash refund of the commuted value of your pension if your pension is less than 4% of $54,900*
You can take a cash refund of the commuted value of your benefit if the annual pension you have earned is less than 4% of $54,900*. You may also make a tax-deferred transfer of the cash refund to your RRSP.
*Year’s maximum pensionable earnings (YMPE) in the year you leave your OMERS employer – YMPE for 2016 = $54,900.
You can ignore that. What you've written afterwards makes it clear your "cash refund" amount actually is not a refund of contributions that previous text is about.
My estimated commuted value of my persion is 473,587.77 ... Now The Income Tax Act (ITA) sets a variable factor to determine the limit on the amount you can tax shelter when you transfer the commuted value, please note that you can only transfer approximately $213,733.79 to a LIRA. This amount is an estimate only and will be recalculated as of the we pay it. Any commuted value amount over the limit will be sent to you in cash and income tax will be deducted .... So what are all the options I can do with this amount $259,853.98 ? . Is it possible to cash all of it ? Thanks....
It seems that your pension is worth so much that its commuted value (about $473,600) exceeds the maximum limit (in your case, about $213,700) that CRA allows to be directly transferred out to a locked-in RRSP. 
Up to your unused RRSP contribution room, the commuted value above the limit (about $259,900) can be transferred directly to a regular RRSP, tax-deferred. Any of above-limit amount that is not or cannot be transferred directly to an RRSP will be added to your income and taxed.
For example, if you only had $20,000 of unused RRSP contribution room. Then, $20,000 of the $259,900 could be transferred directly to an RRSP. The remaining $239,900 would have to be taken as a taxable cash withdrawal.
WestCoast Actuaries (Individual Pension Plans): Maximum Transfer Limit describes these kinds of situations.
11:07 am
June 15, 2016
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Ok .... Thank you ! and everyone else ... I'm going to stay until the end I hope.... Though, I will say this about government job or at least where I am at... If I knew what I know now about my job back when I applied, I would of never done so .... The place is very corrupt ... If you let your guard down you will get nailed . They got me good, now I will have to live with it ? And it is my fault ... Again, THANKS TO EVERYONE !!!
11:57 am
October 21, 2013
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... but if you hadn't taken this job, you might have found that other workplaces present problems that are just as bad or worse... and probably don't offer a great pension plan!
Good luck to you!
12:18 pm
April 6, 2013
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They got me good, now I will have to live with it ? And it is my fault ...
One never has the benefit of hindsight at the time decisions are made.
I don't blame myself for decisions that, after doing the diligence, looked good at the time but don't turn out to be so in hindsight. If one would make the same decision again, knowing what one knew then, then it wasn't such a bad decision. That applies to jobs, relationships, and investments.
I think we should all allow ourselves that.
1:09 pm
June 15, 2016
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That maybe so Loonie but with all government jobs there one thing they'll have in comment. With these jobs you know where one might be at all times . If you work else where one can always take off and go else where . It usually not so with government jobs . How often do you hear so and so leaving a gov job? Not to often . So, if you every wanted to keep someone in place for years to come, give him or her a gov job just how it was handed to me, but I'm 100% positive in the " end " that's when I will be truly happy again .... This is my last post and I doubt if I will be back .... Take care and god bless
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