Locked-In Retirement Account (LIRA) - Ontario

A registered retirement savings plan into which is transferred money accumulated in a supplemental retirement plan (widely known as a "pension fund") set up by an employer.

For employees who have contributed to an employer-sponsored retirement plan in Ontario.

You may convert your LIRA into an annuity or LIF at anytime, but no later than December 31 of the year in which you turn 71.

Features

• Administered by the Financial Services Commission of Ontario.
• Total or partial conversions possible.
• Upon death, LIRA balance is turned over to surviving spouse, or in some cases, your estate.
• Can be converted into and Ontario Life Income Fund (LIF) or a Locked-in Retirement Income Fund (LRIF).
• No withdrawals allowed before retirement.

Advantages

• No minimum conversion age.
• Capital grows tax-free.
• Funds are unseizable.

Under what circumstances can you withdraw money from your LIRA?

• A doctor certifies that you have a life expectancy of less than two years: the balance may be withdrawn in full or in part.
• You are having financial difficulties; you may withdraw the amount authorized by the Commission.
• You are over age 55 and the balance of your retirement funds (other than RRSPs and RRIFs) do not exceed 40% of the CPP maximum pensionable earnings; the balance may be withdrawn in a lump sum.

In all three cases, you may also put the authorized withdrawal amount into your RRSP.

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