TaxTips.ca - LIF and LRIF minimum and maximum withdrawals

TaxTips.ca Canadian Tax and Financial Information	LIF and LRIF Minimum and Maximum Withdrawals	TaxTips.ca does not research or endorse any product or service appearing in ads on this site. Before making a major financial decision you should consult a qualified professional. Copyright © 2012
Looking for US tax information? See USTaxTips.net

List your firm for free in the TaxTips.ca Business Directory.

Need an accounting, tax or financial advisor? Look in the TaxTips.ca Business Directory.

Financial Planning -> Pensions -> Registered Pension Plans (RPPs) - LIF and LRIF minimum and maximum withdrawals

Minimum withdrawals

LIFs and LRIFs are subject to minimum withdrawals under the Income Tax Act (ITA). The ITA treats LIFs and LRIFs the same as registered retirement income funds (RRIFs). See the article on our RRSP/RRIF page for the factors used to calculate minimum withdrawals. There is no withdrawal required in the year the LIF or LRIF is started.

Use our RRIF calculator to calculate minimum withdrawals. The RRIF calculator will not calculate maximum withdrawals for locked-in accounts.

Maximum withdrawals

LIFs and LRIFs have maximum annual amounts that may be withdrawn. The maximum amounts are regulated by federal or provincial pension legislation (not the Income Tax Act), depending on the plan from which the LIRA originated. The maximum is usually the greater of:

	the investment gains from the account in the previous calendar year, or
	an amount determined by multiplying the beginning of year balance by a prescribed annuity factor, which depends on an interest rate and the owner's age.

Follow the links in the table of RPP regulators above to find information on how your maximum withdrawal is calculated.

Revised: November 02, 2010

The information on this site is not intended to be a substitute for professional advice. Each person's situation differs, and a professional advisor can assist you in using the information on this web site to your best advantage.
See our Business Directory for tax, accounting and finance-related firms in your area.
Please see our legal disclaimer regarding the use of information on our site, and our Privacy Policy regarding information that may be collected from visitors to our site.