Canadian ITA maximum pension

Returns the maximum annual accrued pension, based on the annual dollar limit, under the Canadian ITA maximum pension regulations. Benefits are deferred to the right argument Age and based on Service according to the left argument. For more information, see the discussion of the ITA Maximum Pension parameters (found under the Regulatory Data topic of Valuation Assumptions).

This limit is reduced for early commencement, as indicated by Age, according to the selection for the Use public safety early retirement reduction check box (an ITA Maximum Pension parameter). If the box is not checked, the benefit is reduced for commencement prior to the earliest of attainment of age 60, completion of 30 years of service and attainment of 80 points (age plus service). If the box is checked, the benefit is reduced for commencement prior to the earliest of attainment of age 55, completion of 25 years of service and attainment of 75 points (age plus service).

Typically, this operator is used in the benefit formula of a Benefit Definition or in a subformula type of Benefit Formula Component; in such cases, the service used in the limit calculation is as of the assumed decrement date. However, when this operator is used to calculate a projected unit credit or pure unit credit liability, the service used is as of the valuation date. Furthermore, when this operator is used to calculate a solvency liability, the dollar limit is as of the valuation date with no increase rates applied.

When this operator is used in an accrual definition type of Benefit Formula Component (an atypical application), either in an Accrual Basis formula or in a subformula type of Accrual Basis Component, all inputs to the calculation (both service and the dollar limit) are as of the decrement date, i.e., the limit is assumed to be fully attributed by the year beginning on the valuation date.

Syntax:

(Service Indicator) #CANMAX Age

Age is the deferral age, or 0 if immediate.

Age must be an integer.

Service Indicator:  0 = all service (default)

  1 = post-reform service only

  2 = pre-reform service only

Examples:

#CANMAX 0  equals the ITA maximum pension payable immediately, based on all service.

0 #CANMAX 60 equals the ITA maximum pension deferred to age 60 (without an early retirement reduction), based on all service.

1 #CANMAX 0 equals the ITA maximum pension payable immediately, based on post-reform service only.

2 #CANMAX 0 equals the ITA maximum pension payable immediately, based on pre-reform service only.