Pension Adjustment Reversal - PAR


DEFINITION of 'Pension Adjustment Reversal - PAR'

A numerical calculation in certain Canadian pension plans that reverses a previously assumed pension value. This can occur when an employee leaves a company after a short period of time and before he or she is vested. As a result, the employee may only have his or her pension contributions and not any employer contributions. The pension adjustment reversal "reverses" the overstated pension adjustments, since the employer contributions are not counted.

BREAKING DOWN 'Pension Adjustment Reversal - PAR'

The pension adjustment reversal reduces the amount of money that has been contributed in that year's pension plan, thereby increasing the Registered Retirement Savings Plan (RRSP) deduction limit. In order to be eligible for a pension adjustment reversal, the employee must terminate his or her membership in the pension plan (for example, by transferring benefits to a Registered Retirement Savings Plan), but not necessarily his or her employment with the company. Conversely, an employee who leaves a company but continues membership in the pension plan is not eligible for the PAR.

  1. Form 8891

    An IRS form that must be completed by any U.S. citizen or resident ...
  2. Registered Pension Plan - RPP

    A form of a trust that provides pension benefits for an employee ...
  3. Registered Retirement Income Fund ...

    A retirement fund similar to an annuity contract that pays out ...
  4. Registered Retirement Savings Plan ...

    A legal trust registered with the Canada Revenue Agency and used ...
  5. Canada Pension Plan - CPP

    One of three levels of Canada's retirement income system, which ...
  6. Canada Revenue Agency - CRA

    A federal agency that collects taxes and administers tax laws ...
Related Articles
  1. Savings

    Tax-Saving Tips For Canadian Taxpayers

    Find out how to get a bigger return.
  2. Retirement

    Tax Breaks For Canadian Families

    Canadians have a lot of advantages when it comes to family tax perks.
  3. Retirement

    Lazy Portfolio Strategies For Your RRSP

    Check out this cheap and easy way to secure good returns for the long term.
  4. Retirement

    Maxing Out Your RRSP (Canadian)

    Increasing your savings will provide tax benefits - and peace of mind.
  5. Taxes

    Registered Retirement Savings Plans (RRSP)

    Learn how the Canadian government makes saving for your post-work years easy. We take you from your first contribution to your first withdrawal.
  6. Retirement

    The Cities Where the Ultra-Rich Retire in Florida

    Understand why the Florida communities of Miami Beach, Palm Beach and Key West serve as magnets for the ultra-rich retirees who descend on the state.
  7. Professionals

    Is Delaying Social Security Until 70 a Good Idea?

    Soon to be retirees are often told it's best to wait until age 70 to collect Social Security. Here's why this is not always the best advice.
  8. Professionals

    Top Tips for Maximizing Social Security

    Between delaying filing, claiming strategies and taking advantage of special marital benefits, there are several ways to maximize Social Security.
  9. Retirement

    The 5 Best Retirement Communities in Austin, Texas

    Discover five of the most desirable retirement communities for seniors located in the Austin/Georgetown metropolitan area in Texas.
  10. Options & Futures

    Pick 401(k) Assets Like A Pro

    Professionals choose the options available to you in your plan, making your decisions easier.
  1. How does a Roth IRA grow over time?

    Your Roth IRA account grows over time thanks to two funding sources: contributions and earnings. While your contributions ... Read Full Answer >>
  2. Can my 401(k) be seized or garnished?

    As long as your retirement funds are held in your 401(k) and you do not take them as distributions, your 401(k) cannot be ... Read Full Answer >>
  3. Can my IRA be taken in a lawsuit?

    Whether your IRA can be taken in a lawsuit depends largely on your state of residence and the judgment in question. There ... Read Full Answer >>
  4. Are mutual funds considered retirement accounts?

    Unlike a 401(k) or Individual Retirement Account (IRA), mutual funds are not classified as retirement accounts. Employers ... Read Full Answer >>
  5. Can my IRA be garnished for child support?

    Though some states protect IRA savings from garnishment of any kind, most states lift this exemption in cases where the account ... Read Full Answer >>
  6. Can I use my IRA savings to start my own savings?

    While there is no legal reason why you cannot withdraw funds from your IRA to start a traditional savings account, it is ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
  2. Normal Profit

    An economic condition occurring when the difference between a firm’s total revenue and total cost is equal to zero.
  3. Operating Cost

    Expenses associated with the maintenance and administration of a business on a day-to-day basis.
  4. Cost Of Funds

    The interest rate paid by financial institutions for the funds that they deploy in their business. The cost of funds is one ...
  5. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
  6. Capitalized Cost

    An expense that is added to the cost basis of a fixed asset on a company's balance sheet. Capitalized Costs are incurred ...
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!