Increase in default contribution rates for in force VRSPs
Thank you for choosing Sun Life as the Voluntary Retirement Savings Plan (VRSP) provider for your client.
Since they have joined the plan, many of their employees have been contributing at 3% of their gross salary, which is the default rate since January 1, 2018. VRSP legislation requires that this default contribution rate increase to 4% on January 1, 2019. This will be the final default contribution rate increase for the VRSP, based on current legislation.
Please note that the new default rate of 4% will not affect plan members who have actively selected a contribution rate.
We've been tracking contribution rates, but it's your client's obligation to adjust any payroll deductions affected by this change. To get an updated list of contribution rates for their employees, they can visit the plan sponsor website at sunlife.ca/PlanSponsor on or after January 7, 2019 and generate an updated Payroll deduction member report. They can then use this report to make the required changes in their payroll system. We're here to help them for any question or any support they may need.
We will be communicating with clients soon. A copy of the communication can be found enclosed.
For more information on VRSPs and the tools available, please visit the VRSP website at www.sunlife.ca/VRSP .
Please contact us with any questions or concerns.
Sun Life Financial Small Business Centre