A PAR restores lost RRSP deduction room to individuals who leave registered plans before retirement.
PAs generally overstate the value of retirement benefits for younger and middle age employees.
PAs and PSPAs reduce the RRSP deduction room. PAR will make the system for tax-assisted saving for retirement more fair and effective for those who change jobs or move in and out of the workforce. It applies to plan members who terminate from a plan after 1996. The administrator of a Registered Pension Plan or the trustee of a Deferred Profit Sharing Plan must report a PAR where required to Revenue Canada and to the affected individual. If the employer is not the administrator, the employer will have to supply prior PA information to the administrator.