The Form 7 is an administrative form that plan sponsors must complete within the first 60 days of the pension plan’s fiscal year to provide an estimate of expected contributions to the trustees of the plan. The trustee is expected to monitor the contributions and advise FSRA if contributions received do not match the Form 7 within certain timelines and variance allowances.
To help ease the administration of Form 7s and submitting revised versions, FSRA has recently announced some changes along with new forms that will become effective March 31, 2022. The most significant change relates to the increase in reporting variances from 10% to 25%. This means that trustees will be required to report any variances to FSRA if the contributions indicated on the Form 7 exceeds 25% (previously set at 10%). In addition, the reporting period for informing FSRA of any variances will change from monthly to quarterly. Trustees will be required to report any variances above the thresholds to FSRA within 60 days after the end of each quarter. FSRA has also confirmed that any temporary variations do not require a revised Form 7 if a satisfactory explanation is provided to the trustee by the plan sponsor.
Although the changes are not effective until March 31, 2022, plan sponsors can voluntarily use the new forms starting January 1, 2022.