Friday, July 9, 2010

CRA has accepted Nortel's foreign Service Accrual method in calculating pensons.

I received the following note from a representative of the NRPC regarding Foreign Service Accrual in pensions. The Canadian Revenue Agency has accepted Nortel's traditional method for including foreign service when they are calculating the amount of pension a retiree will receive. This is good news for a change. It means that many of us who worked in multiple countries will be able to breath a little easier since the basic pension calculation will remain as promised by Nortel. Possible reductions due to trust fund issues and annuity rates will still apply of course.

Here's a copy of the email.

For those of you who have been worried about, or caught up in the delays caused by, the negotiations with the Canada Revenue Agency regarding foreign service accrual when calculating pensions, we have good news from our legal representatives, Koskie Minsky LLP.

The CRA has accepted the Nortel approach to calculating foreign service in the pension calculation. The attached letter from the CRA to the Monitor provides a somewhat complex answer to this good news. Koskie Minsky will post more on their website in the next week or so but for now you can get a good night's rest.

For those who have recently applied for their Canadian pension and were put on hold, I do not know how quickly things will get restarted but this letter should allow things to proceed

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