Unlocking Options
Information
The unlocking options available from a locked-in retirement savings plan or a pension plan, and the conditions that must be met to take advantage of them, are set out in sections 20, 20.1, 20.2, 20.3 and 28.4 of the Pension Benefits Standards Regulations, 1985 (PBSR).
Please note that not all unlocking options are available from a pension plan or from every locked-in retirement savings plan. The chart below provides a general description of the unlocking options, from where they are available, and a link to the forms that must be completed. A number of the unlocking provisions refer to the "Year's Maximum Pensionable Earnings" (YMPE) in determining whether funds can be unlocked and/or the amounts that can be unlocked. The YMPE is a dollar amount that is the maximum pensionable earnings under the Canada Pension Plan and changes annually based on a legislated formula. The YMPE for 2024 is $68,500.
| Unlocking Options | Available From | Unlocking Amount ($) | Required Form(s) |
|---|---|---|---|
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Financial hardship: If a person is:
a certain amount may be withdrawn from a locked-in account. The funds may be withdrawn as cash, or transferred to a tax-deferred savings vehicle such as a registered retirement savings plan (RRSP) or a registered retirement income fund (RRIF), subject to any applicable income tax rules. |
|
The 2024 YMPE is $68,500. |
Form 1 and Instructions: Attestation Regarding Withdrawal Based on Financial Hardship |
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Non-residency: If the following criteria are met, then a person's pension may be withdrawn in cash or transferred to a tax-deferred savings vehicle such as an RRSP or a RRIF subject to any applicable income tax rules:
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* If the pension funds are in a pension plan, the plan administrator may release the funds but is not required to do so. |
The total value of the pension benefit or locked-in account balance |
No prescribed form required |
|
Shortened life expectancy: If a person has a shortened life expectancy (as certified by a physician) due to a physical or mental condition, the funds may be withdrawn in cash or transferred to a tax-deferred savings vehicle such as an RRSP or an RRIF subject to any applicable income tax rules. |
* If the funds are in a pension plan, the pension plan may provide a payment or a series of payments in lieu of a pension benefit, but is not required to do so. This option is not available if a person has already commenced their pension. |
The total value of the person's pension benefit or locked-in account balance |
No prescribed form required |
|
Small pension benefit unlocking from a pension plan: If a person has ceased membership in a pension plan and the value of their pension benefit is less than 20% of the YMPE for the calendar year in which their membership ceased, then the plan administrator can choose to pay out this amount in a lump sum. The funds may be paid in cash or transferred to a tax-deferred savings vehicle such as an RRSP or an RRIF subject to any applicable income tax rules. |
|
The total value of the person's pension benefit |
No prescribed form Terminating member would receive a termination statement from the plan administrator |
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Age 55 and over - One-time 50% unlocking: If a person:
they may transfer 50% of the funds in their RLIF into an RRSP or an RRIF. Cash can then be withdrawn, from either of these vehicles, subject to any applicable income tax rules. The funds cannot be taken directly in cash from an RLIF. |
|
Up to 50% of the total value of the locked-in account balance |
Form 2: Attestation Regarding Spouse/Common-Law Partner |
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Age 55 and over - Small account balance unlocking If:
the funds may be withdrawn as cash, or transferred to a tax-deferred savings vehicle, such as an RRSP or an RRIF subject to any applicable income tax rules. |
|
Total value of the locked-in account balances. |
Form 2: Attestation Regarding Spouse/Common-Law Partner Form 3: Attestation of Total Amount Held in Federally Regulated Locked-in Plans |