I recently started receiving my pension payments (PSSA) after retiring in April 2025. Industrial Alliance (the LTD insurance company) sent me a letter with calculations as to how much I owe them back, since the retroactive pension payment was made to me, not them. I reviewed the amounts and I agree with the gross amounts of the amounts I received and what I was entitled to receive, but I disagree for the taxes and the final amount owing.
My pension doesn’t have any taxes withheld at source, and my LTD benefits have the federal tax deducted at source every month. According to the notices of deposits I received, I paid a total of 3,164.83 in federal tax for the period in question, not 3,177.15 like they wrote. I also don’t know where they came up with the 1,083.90 amount… they didn’t use the same rate…???
Now, regardless of the amounts of taxes I paid, I don’t understand why they’re only deducting (“Federal Tax adjustment for 2025”) approx. 2/3 of the taxes I already paid. I think the full amount of taxes that was transmitted to the government should be deducted from the gross amount. It’s not like the government is going to refund me/them that remaining 1/3 to hold onto right now until I have to pay it again when I file my 2025 income tax return.
Can anybody please help me figure out the reasoning behind the tax numbers and if I’m correct to request to have the full amount of taxes already paid get deducted from the gross overpayment amount? Thank you!!!
side note: I’m awaiting the result of my CPP-D application. If I’m approved it will trigger another overpayment calculation in the future… wish me luck.