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Both you and CBS contribute to the Defined Contribution (DC) plan. Your contributions are deposited in an employee account, and CBS's contributions are deposited in an employer account. These two accounts, which you choose how to invest, together with investment income, make up your retirement account.

Your required contributions

  • Once you join the plan, you contribute 4.75% of your earnings annually.

  • Your earnings means your basic annual salary, excluding bonuses, shift premiums, and overtime pay. This amount is divided by 26 (the number of your bi-weekly pays each year), and rounded to the nearest cent.

Here's an example.

Sam works full-time and earns pensionable earnings of $50,000 a year

Annual pension contribution 4.75% × $50,000 = $2,375
Bi-weekly contribution $2,375 ÷ 26 = $91.35
Sam pays $91.35

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Tax treatment of your contributions

  • All your contributions to the Defined Contribution (DC) plan are fully deductible from your taxable income. You benefit right away, since contributions to the plan are deducted from your pay before Payroll calculates your income tax.

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CBS's contributions

  • CBS contributes 6.75% of your earnings to the Defined Contribution (DC) plan.

Supplementary CBS contributions

  • If you were a member of the Canadian Red Cross Pension Plan — Part I on November 1, 1997, and were 43 years old or older on that date, CBS will make additional supplementary contributions each year, equal to the percentage of your pay indicated in the following table.

Attained age as of November 1, 1997 Supplementary contribution rate Attained age as of November 1, 1997 Supplementary contribution rate
43 0.4% 54 4.2%
44 0.7% 55 4.4%
45 0.8% 56 4.9%
46 1.1% 57 5.4%
47 1.4% 58 5.9%
48 1.8% 59 6.4%
49 2.2% 60 6.9%
50 2.5% 61 7.5%
51 2.9% 62 8.0%
52 3.3% 63 8.6%
53 3.8% 64 and older 9.2%

Example of CBS's contribution

Sam was 52 years old on November 1, 1997

CBS' basic contribution 6.75% x $40,000 = $2,700
CBS's supplementary contribution 3.3% x $40,000 = $1,320
CBS's total annual contribution $4,020

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Maximum contribution

  • Under income tax legislation, you and CBS may contribute up to 18% of your earnings to the Defined Contribution (DC) plan.

  • There is also a dollar limit maximum, which is $22,450 in 2010. This limit is scheduled to increase to $22,970 in 2011, and be indexed annually thereafter to increases in the average industrial wage in Canada.

  • These contributions include your required contributions and CBS's contributions to this plan.

  • Head Office Payroll will keep track of your contributions to the DC plan and, once the limit is reached, will stop your contributions.

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