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Unlocking locked-in funds: How does it work?

Unlocking locked-in funds: Process that consists in transferring part of the locked-in funds in a locked-in retirement account (LIRA – provincial) or a locked-in RRSP account (federal) into an RRSP by using a LIF.

Re-locking: Process consisting in the transfer of LIF assets toward a locked-in account in order to avoid having to make withdrawals or draw income from it.

Federal process (Locked-in RRSP) 1


To unlock locked-in funds of up to 50% of the value of your locked-in RRSP, all the account mentioned above must first be opened.

  1. When you open a LIF, you must request the transfer of your assets from your federal locked-in RRSP or LIF into an RLIF (restricted LIF). The LIF or locked-in RRSP will automatically be closed following the transfer of assets to the RLIF.

    The new account will bear the mention “restricted” as you are only allowed to unlock funds for up to 50% of your locked-in RRSP once in your life, even if you request to unlock less than 50% of the eligible funds.
  2. Along with the account documents, you must then provide:
        a.  Form #2 (which will need to be sworn by a National Bank employee)
        b.  T2030 Form in order to transfer the RLIF assets to the RRSP / RRIF
  3. Optional: You can provide a second T2030 Form if you wish to relock the funds in a RLSP to avoid having to withdraw annually from your RLIF. Note that fees may be charged for this request.

Once your assets have been transferred to your RLIF, you have 60 days to request the unlocking of your funds. Beyond that, it will be impossible to unlock funds for the entire duration of your RLIF.

1 You must be 55 years of age or older to request the unlocking of your funds.

Special cases*:

  1. Small balance unlocking:  Form 3 (You must be at least 55 years of age to make this request)
  2. Financial hardship unlocking:  Form 1

*Certain conditions apply. For more details, please contact a representative at 514 866-6755 or 1-800-363-3511, or make an appointment to meet with your National Bank advisor.

Quebec process (LIRA):



You may unlock a locked-in amount from a LIRA for the difference between the LIF maximum and minimum withdrawal allowed. You may do so once a year, each year.

To proceed, all the account mentioned above must first be opened.

  1. When opening a QC-LIRA, you must request a transfer of assets from the QC-LIRA to the QC-LIF. The QC-LIRA will automatically be closed following the transfer of funds to your QC-LIF.
  2. Along with the account opening documents, you must provide:
        a.  Form 26440
        b.  Form T2030 in order to transfer the difference between the maximum and minimum amounts
             in an RRSP. 

Optional:

  • You can provide a second T2030 Form if you wish to relock the funds in a LIRA to avoid having to withdraw annually from your RLIF. Note that fees may be charged for this request.
  • If you qualify and wish to receive a temporary annuity, please fill out Form 15179 during the course of the year in which you wish to receive the temporary annuity (to maximize the amount of the annuity received, the document must be received as soon as possible at the beginning of the year).

 

Special cases*:

  1. Reduced life expectancy: A letter from your physician is required.
    (this type of withdrawal may only be requested from a LIRA)
  2. Small balance unlocking: Appendix 0.2

*Certain conditions apply. Please contact a representative at 514 866-6755 or 1 800 363-3511, or make an appointment to meet with your National Bank advisor.

Ontario process (LIRA):



To proceed, all the account mentioned above must first be opened.

  1. When opening an ON-LIRA, you must request a transfer of assets from the ON-LIRA to the ON-LIF. The ON-LIRA will automatically be closed following the transfer of funds to your ON-LIF.
  2. Along with the account documents, you must provide:
        a.  Form 5.2
        b.  Form T2030 in order to transfer the difference between the maximum and minimum amounts
             in an RRSP.

Once your funds have been transferred to your ON-LIF, you have 60 days to request the unlocking of your assets.

Special cases*:

  1. Reduced life expectancy: Fill out Form 5.1 and attach a letter from your physician
  2. Small balance unlocking: Fill out Form 5
  3. Financial hardship: Fill out Form 6.1 and attach a letter from the Ontario government

*Certain conditions apply. Please contact a representative at 514 866-6755 or 1-800-363-3511, or make an appointment to meet with your National Bank advisor.

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