Ontario LIF - Unlock 50%

LIF Withdrawals

  • Subject to maximum withdrawal limits governed by the pension legislation of your plan
  • At age 55 (or earlier if permitted) convert your Ontario LIRA to a New Ontario LIF and subsequently unlock up to 50% of the LIF by transferring assets into a RRSP or RRIF
  • This one-time opportunity must be done within 60-days of the conversion

Examples

  • Immediate Access to Funds - If you need access to funds, you can withdraw up to 50% of the LIF account within 60-days of the conversion. Amounts withdrawn are taxed as income
  • Future Access to Funds – Transferring up to 50% of your LIF to a RRSP or RRIF gives you flexibility for future withdraws since the RRSP and RRIF accounts are not subject to maximum withdrawal limits

Implications of Conversion

  • Could lose creditor protection of the unlocked assets, by the Pension Benefits Act
  • May need spousal consent to unlock the assets
  • Mandatory minimum payments from the new LIF begin the following year