Retiring allowance is paid to employees when or after they retire from an office or employment in recognition of long service, or an amount paid for the loss of office or employment.
A retiring allowance includes the following:
- payments for unused sick-leave
- amounts individuals receive when their office or employment is terminated, even if the amount is for damages (wrongful dismissal)
The eligible part (calculated by the payer) of a retiring allowance can be transferred to the individual’s own RPP, SPP, RRSP or PRPP. An eligible retiring allowance can be transferred directly or indirectly.
For more information on the non-eligible part or the calculation of the eligible part of a retiring allowance see Transferring retiring allowances (severance pay).
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