You may be able to withdraw the balance of your pension account early if you qualify for one of the following unlocking provisions:
- Reduced Life Expectancy
You may withdraw the balance of your account in whole or in part, and receive a payment or a series of payments if you have a reduced life expectancy. To qualify, a physician must certify (in writing to the financial institution that is party to the contract or the administrator of a pension plan) that you suffer from a significant physical or mental disability that considerably reduces life expectancy. The physician must use the underlined wording in order to comply with subsection 33(2) of the Pension Benefits Act and subparagraphs 21(2)(d), 22(1)(a), 23(1)(i) and 25.4(1) of Regulation 91-195. If you have a spouse or common-law partner, a waiver in Form 3.01 must be completed.
- Non-Canadian Citizen/Resident
You may withdraw the balance of money in your pension plan, locked-in retirement account (LIRA) or life income fund (LIF) if all three of the following criteria are met:
- Neither you nor your spouse or common-law partner are Canadian citizens;
- Neither you nor your spouse or common-law partner are residents of Canada; and
- Your spouse or common-law partner signs a spousal or common-law partner waiver (Form 3.5).
- One-time partial unlocking from a LIF to a RRIF
You may make a once-in-a-lifetime withdrawal from a LIF of three (3) times the annual amount to a maximum of 25% of the balance in the LIF. You may only use this option if you have not previously transferred an amount under this provision. In the application you must make a sworn declaration certifying that the transfer is being made freely and voluntarily and not because of any judgment that anyone has against you. This partial unlocking from a LIF to a RRIF requires Form 3.3 and Form 3.4. You can see an example of the calculation here: Transfer from LIF to RRIF.
- Small Balance Transfer
You can apply to unlock small balances contained in a pension plan or a LIRA. The formula to determine what qualifies as a small balance is based on your age. For example, to qualify in 2014, at age 60 your total locked-in assets must be less than $15,692. For the two years prior to your application, your Pension Adjustment amount (reported on your T-4) must equal zero. This means if you have recently been a member of a pension plan you will not qualify under this provision. You must complete Form 3.6 and Form 3.7 to process this type of unlocking.