For buybacks involving credit for previous tax years, a “past service
pension adjustment” (PSPA) approved by CRA may be required.
In most cases, once OPTrust receives the signed Agreement to Purchase Credit
(OPTrust 1017) for service prior to the current tax year, we calculate the PSPA
and forward it directly to CRA for approval. An exception to this rule concerns
prior year service for an LOA that ends in the current tax year. In this case,
OPTrust will report a PA, instead of a PSPA.
Once OPTrust receives CRA approval for the PSPA, we will inform the member and
confirm the payment option selected.