Small pension payout threshold to double from $1,500 to $3,000 under Ontario pension rules

Ontario's General Regulation under the Pension Benefits Act is being amended to double the dollar threshold used wherever the $1,500 figure appears, replacing it with $3,000. This threshold typically governs when a pension plan administrator can pay out a small benefit as a lump sum rather than keeping it in the plan. Plan administrators and sponsors should review their plan documents and administrative processes to ensure they are ready to apply the higher $3,000 limit when the change takes effect. Members with small pension entitlements near the current threshold may be affected by how and when their benefit is paid out.

Deadline for MPPs to choose pension option extended by six weeks

The cut-off date by which Members of Provincial Parliament must make a pension option election under the MPPs Pension Act has been pushed back. The deadline was previously set at June 5, 2026 and has now been moved to July 17, 2026. Current or former MPPs who are required to make a pension option choice under the Act have additional time to do so. Anyone in this situation should ensure they are aware of the new deadline and act accordingly before it passes.

County of Oxford and Township of Norwich authorized to grant development-charge relief to VDK Development Inc.

The regulation has been expanded to allow the County of Oxford and the Township of Norwich to grant assistance to VDK Development Inc. in the form of full or partial exemptions from development charges imposed under the Development Charges Act, 1997. The assistance window is a six-month period starting in mid-2026. The County of Oxford's assistance is capped at $800,000, while the Township of Norwich's is capped at $400,000. This relief can be granted directly or indirectly to the company. Municipalities, developers, and parties involved in development charge planning in Oxford County and Norwich Township should be aware of this new authority and its time-limited nature.

Ontario government authorized to borrow up to $35 billion under new loan legislation

A new Ontario statute authorizes the provincial government to borrow up to $35 billion in total to pay off existing provincial debts and obligations or to make payments required by other legislation out of the Consolidated Revenue Fund. This borrowing authority is on top of whatever borrowing powers already exist under other Acts. Orders-in-council approving specific borrowing under this Act must be issued by December 31, 2028. Any actual borrowing under those orders must occur by December 31, 2029, unless by that date the Crown has already signed a borrowing agreement or enrolled in a borrowing program under the relevant order. Organizations that lend to or hold Ontario provincial debt, or that track provincial fiscal capacity, should be aware of this new authority.

Ontario's debt burden reduction strategy must now include metrics in its progress update

The annual debt burden reduction strategy that the Ontario government publishes with each budget must now include a progress update with specific metrics, rather than a general progress report on supporting actions. The practical change is that the update must now be measurable and quantified, not just descriptive. This affects how the government reports on its debt-reduction objectives relative to the ratio of provincial net financial liabilities to gross domestic product. Organizations that track Ontario's fiscal reporting, such as financial analysts, bond rating agencies, and public accountability groups, should expect more data-driven disclosure in future budgets.

Ontario Taxation Act updated: dividend tax rates, small business rate, beer credit, Trillium Benefit thresholds, and procedural rules all revised

Ontario's Taxation Act has been amended in several areas. The provincial gross-up rate applied to eligible dividends received by individuals is being reduced for tax years after 2026 (from 22.895% to 15.2283%), and the small business corporate tax rate will rise from 8.3% to 9.3% for days after June 30, 2026, narrowing the gap with the general rate. The Ontario Trillium Benefit payment rules are updated so that, starting with the 2025 base taxation year, the threshold for choosing a single annual payment rises from $360 to $500. The Ontario Computer Animation and Special Effects Tax Credit now has a clearer test for what prior-year labour expenditures reduce the current claim, and the Ontario Made Manufacturing Investment Tax Credit is now limited to expenditures incurred before January 1, 2027. The small beer manufacturers' tax credit formula is revised with new per-litre rates for the March 2026–February 2027 sales year and for years starting March 1, 2027. New procedural provisions incorporate additional federal assessment and evidentiary rules into the Ontario Act.

Section 4 of the Privatization Act flagged for future repeal once Lieutenant Governor proclaims a date

An amendment has been added to the consolidated text noting that section 4 of this Act — which exempts privatization transfers from a specific provision of the Financial Administration Act — is scheduled to be repealed on a date yet to be set by the Lieutenant Governor in Council. Until that proclamation is made, section 4 remains in effect and the exemption continues to apply. Organizations involved in transactions or agreements under this Act should monitor for the proclamation date, as the repeal could affect how those transactions are governed going forward.

Future repeal of two Financial Administration Act exemptions flagged in Electricity Act consolidation

The consolidated text of the Electricity Act now includes editorial notes signalling that two provisions — one exempting certain Part transactions from section 28 of the Financial Administration Act (s. 51), and another doing the same for securities-related orders involving Hydro One and Ontario Power Generation (s. 122(3)) — are scheduled for repeal on a date still to be set by the Lieutenant Governor in Council. No repeal has taken effect yet; these are prospective amendments recorded in the statute's amendment history. Entities involved in transactions covered by those exemptions — particularly those relying on the carve-out from Financial Administration Act approval requirements — should be aware that those exemptions will eventually disappear and plan accordingly.

New advisory committee will screen WSIB board appointments before they reach the Minister

Pending proclamation, a formal advisory committee must be established to vet and recommend candidates for most WSIB board member positions before the Minister can propose names to the Lieutenant Governor in Council. At least a majority-plus-one of the board's appointed members (those in the general category) must come from candidates the committee recommends, and the committee itself must include both public members selected through an open process and individuals with occupational health and safety backgrounds. Candidates must first apply through the Public Appointments Secretariat. The board of directors also gains a new formal channel to recommend in writing that a member's appointment be revoked, which the Minister must consider. These changes are not yet in force and will take effect on a date to be set by order.

Ontario expands the election to treat funded benefit plans as unfunded for tax purposes, with new ministerial regulation powers

Planholders of funded benefit plans can now elect to have their employer health tax on benefit plan contributions calculated under the unfunded-plan rules (based on benefits paid rather than contributions made). Previously this election was only available to qualifying trusts with excess assets; it is now open to any funded benefit plan planholder. The Minister gains authority to prescribe limitations on which plans may elect, how long elections last, and to make regulations overriding the normal transition rules when an election is made or revoked — including regulations that can apply retroactively. Planholders who think they may benefit from switching to unfunded-plan tax treatment should review whether they qualify and how to file an election in the form and manner the Minister approves. The earlier disclaimer about the consolidation being affected by retroactive provisions has been removed, suggesting the retroactive provisions have now been incorporated.

Ontario creates the Protect Ontario Account Investment Fund as a new designated purpose account under the Financial Administration Act

The amendment establishes a new designated purpose account called the Protect Ontario Account Investment Fund (Fonds d'investissement du compte Protéger l'Ontario). The Minister of Finance is required to set up this fund, and the Lieutenant Governor in Council may authorize amounts to be deposited into it on terms the Minister determines. Money in the fund can be spent on investments that promote innovation, infrastructure development, long-term economic growth, and other strategic provincial priorities. Unlike most government investments, expenditures for this fund are not charged to the Consolidated Revenue Fund in the same way—a specific carve-out removes that default rule for this fund. Returns and proceeds from investments flow back into the fund, though the Minister can direct some proceeds to remain in the Consolidated Revenue Fund instead. Regulations may be made prescribing terms, conditions, and restrictions on the securities and instruments the Minister may hold for this fund's purposes.

Ontario pension law expanded to allow variable life benefits, new wind-up rules, and extinguishment of untraceable members' benefits

Ontario's Pension Benefits Act has been amended to introduce a new type of pension payment called a "variable life benefit" — a pooled, non-account-based pension paid from a dedicated fund whose amount can fluctuate based on investment returns, mortality experience, and actuarial assumptions. Pension plans may be designed to offer this option, and members with defined contribution or additional voluntary contribution balances may elect to transfer those funds into a variable life benefit fund before retiring. A parallel set of partial wind-up rules (sections 77.0.1–77.0.7) has been added specifically for plans offering variable life benefits, since the general bar on partial wind-ups still applies to other plan types. A new section (102.5) allows plan administrators to apply to the Chief Executive Officer to extinguish the rights of former or retired members who appear to be over 100 years old and cannot be located, with defined consequences for misapplied consents. The Guarantee Fund monthly benefit threshold for wind-ups on or after March 26, 2026 has also been increased from $1,500 to $3,000 per month. Most of the new variable life benefit provisions are not yet in force and require a proclamation order.