Q&A: Unlocking federal LIF
Question: I have a federally regulated locked-in LIF. I understand
that legislation has changed allowing the funds to be un-locked if a person
is a non-resident for two years. Is this true and if so how would I proceed
to find out the requirements? – M.Z.
Gordon Pape answers: That is correct. Quoting from the website
of the Office of the Superintendent of Financial Institutions: “Existing
locked-in RRSPs or Life Income Funds (LIF) can be unlocked as long as you have
ceased to be a resident of Canada for at least two calendar years.” A
recent examination by OSFI staff concluded that this provision did not have
to be part of the original pension plan to apply. Ask your plan administrator
to file the necessary forms on your behalf.
I should mention that the rules vary depending on the jurisdiction that governs
the plan. Anyone in a similar situation should verify whether non-residency
is accepted as a reason for collapsing a LIF in their personal case.