Defined Benefit Pension Plans (DBPP)

You can add multiple defined benefit pension plans (DBPPs) to your projections as shown below.

Select Scenario Setup -> Income.

Click Add Pension to add a pension. (You can add multiple pensions and each will be automatically saved once the data entries for each row in the Pensions table have been completed. )

Enter the values for the first pension. Note that you can name the pension, choose to prorate the first year's amount based on the client's birth date, enter the percentage benefit allocated to a surviving spouse, and choose whether to index this pension.  Pensions are indexed from the Start Age of the pension, regardless of whether this is before the first year of the projections or in a later year.

The Start Age should be set as the age that the client will start receiving the pension in the future (if they haven't yet started receiving it) or the client's age as of the first year of the projection (if they've already started receiving it).

If the Start Age is less than 65, then Snap will use the Before Age 65 section for the bridge benefit portion of the pension.  If the pension starts at or after age 65, the amount under Before Age 65 will be disregarded.

If you select Yes for the Prorate column, this means that the first year of the pension will be prorated to start after the individual's birthdate. 

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No Bridge Benefit

If there is no bridge benefit, you should enter the regular pension amount in both the Before and After Age 65 columns. 

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With a Bridge Benefit

If there is a bridge benefit, enter the sum of the regular pension and the bridge benefit as the amount Before Age 65, and enter the regular pension as the amount at Age 65 and After.

From age 65 onwards, the indexing percentage for Age 65 and After is used in the calculation for the pension amount. The Before Age 65 indexing percentage is only used up to age 65. We don’t apply the Age 65 and After indexing rate from the start.

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Option to edit the pension on the Planning page

On the Planning page, the pension has its own column with editable annual amounts. Simply click the value in the year where you want to make a change, then use the pop-up window to make your edits. This may be helpful to prorate a pension to a specific date of the year, rather than to the client's birthday.

Changes that you make on the Planning page will be highlighted in yellow to indicate a manual override of the information entered under Scenario Setup -> Income -> Pensions (DBPP).

To reset the values to those specified under Scenario Setup -> Income -> Pensions (DBPP), you'll need to clear the overrides on the Planning page.

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If you also wish to account for contributions made towards the client's DBPP you can do this on the Planning page.

On the individual Planning page, in the Pensions section, locate the column for your DBPP. Click on the $0 value in the first year. In the pop-up window, enter the contribution as a negative amount. Be careful to copy down to the last employment year (usually one year before retirement). Apply indexing if needed, then save your changes.

Changes that you make on the Planning page will be highlighted in yellow to indicate a manual override of the information entered under Scenario Setup -> Income -> Pensions (DBPP).

These negative amounts will reflect the cash outflow and reduction to taxable income.

Under Taxable Income Details on the Planning page, you'll see the pension contribution amount be included in the Deductions column. To access this table, click the blue icon at the top of the Taxable Income column.

Under Income Tax Details table for given year (accessible by clicking the dollar value under the Total Tax column), you will see the amount reflected in the Registered pension plan (RPP) deduction row.

Please also add a pension adjustment as shown in the next step.

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You may wish to enter a pension adjustment so that the RRSP contribution room is also reduced due to this DBPP contribution.

Click  Scenario Setup -> Assets -> Financial Assets -> RRSP/RRIF to access this setting. 

The client's annual RRSP contribution room will be reduced by this pension adjustment amount every year starting from the 2nd year of the projections. The pension adjustment is automatically indexed with the General Inflation setting each year, found under Scenario Setup -> General.

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