LIRA and LIF: Locked-In Retirement Accounts Explained
What happens to the pension you left behind, how a LIRA becomes a LIF, and what you can take out and when.
You left a job that came with a pension, and the money didn't go into your registered retirement savings plan, or RRSP. It went into a locked-in retirement account, or LIRA, and you can't spend from it. That's the whole idea. It's your old pension money, kept for your retirement the way the plan would have kept it. When you want income from it, you move it into a life income fund, or LIF, and the LIF pays you every year, no less than a minimum and no more than a maximum. What your two numbers are, and whether you can unlock any of your money sooner, depends on which government's pension law your old plan was registered under. Usually that's a province, and each one writes its own rules.
Key takeaways
- A LIRA holds pension money you left behind. It stays sheltered from tax the way your RRSP does, and you can't take cash out of it while it's a LIRA.
- To get income from it, you move it into a LIF. Your LIF has a minimum and a maximum on what you take out each year, and the two come from different laws.
- Under the federal rules, your window at 65 in 2026 is 4.00% to 6.02% of your January 1 balance. About one plan member in ten is in a federally registered plan; for most people the maximum comes from a province's own table.
- You can sometimes unlock money early, but every route has an age, an income test, or a form your spouse signs, and a province sets its own list of routes.
What is a LIRA, and why can't you spend from it?
You get a LIRA when you leave an employer before retirement and take the value of your pension with you. The pension law that covered your plan follows your money. That money was set aside to pay you an income in retirement, so the law keeps it locked until then, and locked means you can't take cash out. You choose what it's invested in, it grows sheltered from tax the way your RRSP does, and it stays put until you move it.
The name on your statement depends on where your plan was registered. If it was federal, your account is called a locked-in RRSP, or a restricted locked-in savings plan.2 In most of the country you'll see LIRA. Whatever the paperwork calls it, you're holding the same kind of account.
Which rules apply to your money?
Before any percentage can mean anything, you have to know whose rules you're under. Every registered pension plan sits under either provincial or federal legislation, and the law your plan was registered under travels with your money for as long as it stays locked in.6 If your plan was federally regulated, the Office of the Superintendent of Financial Institutions, or OSFI, is your regulator, and the federal numbers are yours.1 Otherwise your province's pension regulator sets its own maximum table, its own unlocking routes and its own dollar limits.
Odds are that's you. Of the 7.4 million people with an active membership in a registered pension plan in Canada, about 731,500 are in plans registered with OSFI, which is roughly one in ten.6 So you and a neighbour with the same balance can be reading from different tables, because your old employers answered to different governments.
Your paperwork tells you which one is yours. The statement from the plan you left, or the transfer forms from the bank or insurer that holds your account now, names the act. If it says the Pension Benefits Standards Act, 1985, you're federal.2 If it names a provincial act, that province's regulator publishes the table you need.
How does a LIRA become a LIF?
Your LIRA pays you nothing. When you want income from it, you move it into a life income fund, or LIF, an account built to pay you every year.1 The same deadline your RRSP has applies here, December 31 of the year you turn 71.5 That's also the year your RRSP has to become a registered retirement income fund, or RRIF, and the guide to converting an RRSP walks you through it.
With the money in a LIF, two laws govern one account. The Income Tax Regulations set the minimum you must take each year, and it's the same minimum you'd face in a RRIF. The pension law your plan came from sets your maximum, and under the federal rules that's the Pension Benefits Standards Regulations, 1985.1 The maximum exists so your account keeps paying you, or your survivor, until at least age 90.1 A RRIF has only the minimum. You can take out more than that from a RRIF, right up to everything in it, and nothing stops you.4 In a LIF, the maximum does. The RRIF minimum guide covers the minimum you'll share with every RRIF holder.
How much can you take out of a LIF each year?
Under the federal rules, at 65 in 2026 you can take between 4.00% and 6.02% of what your account held on January 1.1 3 The exact federal figure is 6.0272%, and on a $300,000 LIF, to use a round number, that's $12,000 at the least and $18,081.60 at the most, so the decision in front of you is worth a little over $6,000 a year. If your plan was provincial, your province publishes its own maximum, and it may not be 6.02%. Your minimum comes from federal tax law, so it's the same whichever province you're in. Until you're 70 it's one divided by the years left until you turn 90, and from 71 it follows a table that rises every year.3 If you've read about the 4% withdrawal rule, notice that your federal window at 65 already starts at 4.00%, and your maximum sits two points higher.
Your federal maximum moves every year because it's built from a bond yield. The regulation takes the Bank of Canada's monthly average yield on Government of Canada bonds maturing in more than ten years, for the November before, and assumes your money earns that for the next 15 years and 6.00% a year after that, through the year you turn 90. It works that out afresh each January.1 The 2026 federal table uses 3.49%, the November 2025 figure. The 2025 federal table used 3.26%, so every number in it moved.1 A percentage you read somewhere with no year attached is last year's, or another province's.
Two more details sit on your federal maximum. In your LIF's first calendar year, the maximum is scaled down by the months left in the year, and part of a month counts as a whole month.1 And if your tax-law minimum ever works out higher than your pension-law maximum, you take the minimum. Tax law wins.1 By 89 your federal maximum is 100% of the balance, so the last of it can come out the year you're 89.1
Can you unlock a LIRA or LIF early?
Sometimes. Under the federal rules you have a short list of routes, each with its own test, and if your plan was provincial your province keeps its own list, which may not match this one.2 The dollar limits are tied to the year's maximum pensionable earnings, or YMPE, the earnings ceiling the Canada Pension Plan works from. For 2026 the YMPE is $74,600.2
| Federal route | Who can use it | How much you can unlock | Your spouse or partner signs |
|---|---|---|---|
| One-time 50% | You'll be 55 or older this year, and you act within 60 days of your money landing in a restricted life income fund | Up to half, moved into an RRSP or RRIF | Yes |
| Small balance | You'll be 55 or older this year, and all your federal locked-in accounts together hold $37,300 or less | All of it | Yes |
| Low income | Your expected income this year is under $55,950 | Up to $37,300 with no income, shrinking to $0 at $55,950 | Yes |
| High medical or disability costs | Depends on your expected costs | Up to $37,300 | Yes |
| Shortened life expectancy | A physician certifies it | All of it | Not required by law, though your institution may ask |
| Living outside Canada | You've been a non-resident for at least two calendar years | All of it | Not required by law |
The one-time 50% is the route people ask about most. Federally it runs through a restricted life income fund, or RLIF. You move your locked-in money into one, and within 60 days of the deposit you can transfer half of it, at most, into an ordinary RRSP or RRIF, where it's unlocked for good.2 You can't take that half as cash straight from the RLIF. It goes to your RRSP or RRIF first, and cash comes out of there, taxed as income like any other withdrawal.2 It's a one-time option with a 60-day window, so whatever you don't move stays locked.
The federal low-income route is an income test, and it looks at what you expect to earn this year rather than why. With no expected income you can unlock up to 50% of the YMPE, which is $37,300 in 2026. Your amount shrinks as your expected income rises and reaches zero at 75% of the YMPE, $55,950.2 There's a parallel route if you face high medical or disability-related costs, capped at the same $37,300.2 Two rules meet here, and you need both. Unlocking sits on top of your annual LIF withdrawal and doesn't use up your year's maximum. But money you take from your LIF or RLIF in the same year counts as expected income in the hardship test, so drawing your maximum shrinks what hardship unlocking allows you.2
Your spouse or common-law partner, if you have one, signs a consent form for the hardship, one-time 50% and small-balance routes. The law doesn't require their consent for the shortened life expectancy or non-residency routes, though the institution holding your account may ask for it as its own practice.2 You can combine routes, too. After the one-time 50%, if what you have left is under the small-balance line, that route is still open to you, that year or later.2
Before you move it
A few things change what your LIRA can do for you, and when.
- Whose rules you're under. Federal or provincial decides your maximum and your unlocking routes. Everything else follows from that.
- Your age. Under the federal rules your 50% and small-balance routes open in the year you turn 55.2 The last day of the year you turn 71 is your deadline for a locked-in RRSP, the same as for any RRSP.5
- Whether you might change your mind. Under the federal rules you can move a LIF back into a locked-in RRSP at any point before you turn 71.2 Opening one at 60 to draw for a few years, then closing it again, is allowed.
- Your spouse or common-law partner. Their signature is part of most unlocking routes.
- Your other income this year. The low-income route counts your LIF withdrawals as expected income, so a year with nothing else coming in is the year that route is widest for you.
If your plan was provincial, your maximum for this year comes from that province's regulator, and your LIF statement shows the January 1 balance it applies to.
What most people do with a LIRA
Most people leave a LIRA alone until they stop working, because it can't pay anything out until it becomes a LIF and there's nothing to decide while it grows. People who reach 55 with a federal account and a real need for flexibility often use the one-time 50%, because after that half of the money sits in an RRSP they can draw on any schedule, and the half still locked keeps the maximum that stops it running out. Someone with a small locked-in balance and a large RRSP usually unlocks it once they qualify, because a LIF paying out a tiny amount each year is more forms than income. And people who open a LIF early usually do it because they want the income to start sooner than the deadline would have made them. Your own version depends on the act on your statement, your balance on January 1, and whether you'll want the money this year or in ten.
Common questions
Is a LIRA the same as an RRSP?
No. Your RRSP is money you put in yourself, and you can take it out whenever you want, with tax owing. A LIRA is pension money from an employer you left, and pension law keeps it locked until it becomes a LIF. It's sheltered from tax the same way, but you can't pull cash from it while it's a LIRA.
Do I have to turn my LIRA into a LIF at 71?
You have until December 31 of the year you turn 71, the same deadline your RRSP has. Under the federal rules you can also move a LIF back into a locked-in RRSP any time before you reach 71, so opening one early isn't a one-way door for you.
Can I unlock my LIRA if I lose my job?
Under the federal rules the low-income route looks at what you expect to earn this year rather than why you're short. With no expected income you can unlock up to $37,300 in 2026, and the amount shrinks to nothing once your expected income reaches $55,950. Those are the federal numbers. If your plan was provincial, what you can unlock and on what test come from that province's rules instead.
Is 6.02% my maximum if my plan was provincial?
Only if your old pension plan was federally regulated. 6.02% is the federal maximum at 65 for 2026, and about one plan member in ten is in a federally registered plan. If yours wasn't one of them, your number comes from the province your plan was registered in, and you'd get it from that province's pension regulator.
Is a LIF the same as a RRIF?
Close, but not quite. Both have to pay you a minimum every year, and yours is the same minimum either way, because tax law sets it. Your LIF also has a maximum, from the pension law your old plan came from, and a RRIF doesn't have one. That's the difference you'll feel: with a RRIF you can take everything, and with a LIF you can't.
Sources
- OSFILife Income Funds, Restricted Life Income Funds, and Variable Benefits Accounts: the minimum is set under the Income Tax Regulations and the maximum under the Pension Benefits Standards Regulations, 1985, the bond-yield assumption, and Table 1, the maximum annual amount for 2026 at the November 2025 rate of 3.49%. Page modified 2025-12-17. Accessed 2026-09-04.
- OSFIUnlocking funds from a pension plan or from a locked-in retirement savings plan: the federal account names, the six unlocking routes, the 2026 YMPE of $74,600, spousal consent, and moving a LIF back to a locked-in RRSP before 71. Page modified 2026-01-02. Accessed 2026-09-04.
- CRAChart, prescribed factors: 1 divided by (90 minus the age) at 70 or younger, .0528 at 71 and .0682 at 80 in the all-other-RRIFs column. Accessed 2026-09-04.
- CRAReceiving income from a RRIF: the yearly minimum starts the year after the RRIF is set up, and you can withdraw more, but not less. Accessed 2026-09-04.
- CRAReceiving income from an RRSP: at any age up to the end of the year you turn 71 you choose what your RRSP becomes. Accessed 2026-09-04.
- Statistics CanadaTable 11-10-0094-01, registered pension plans and active members by jurisdiction of plan registration, January 1, 2025: 7,352,686 active members in Canada, 731,520 in plans registered with OSFI. Jurisdiction of plan registration refers to plans under provincial or federal legislation. Accessed 2026-09-04.
Educational, not financial advice. Figures verified against primary sources on the date shown.
See it in a story: "The Question That Keeps Her Up," a teacher a few years from retiring realizes nobody ever taught her how to take the money out. For the minimum your LIF shares with every RRIF, see the RRIF minimum guide, and for the year you turn 71, converting an RRSP to a RRIF. Or browse the whole retirement hub.