Unlocking Pension Funds

Pension funds are locked-in to ensure they will be available to provide a source of income when a person retires.

Under the PBSA a member of a pension plan who becomes vested, acquires the entitlement to receive a pension. Pension payments can begin once the person reaches retirement age. In order to protect the financial security of pension plan members and their spouses, vested pension entitlements are required to be locked-in.

The new PBSA allows pension benefits to be unlocked where the owner of the locked-in funds is facing financial hardship. In addition, there are four other circumstances under which a member may unlock pension funds.

You should first direct all enquiries about locked-in funds to your pension plan administrator or the financial institution holding your pension funds. Answers to some general questions can be found below.

Frequently Asked QuestionsPermanent link to this section

• I am facing financial hardship. Can I unlock my pension funds?Permanent link to this section

  The PBSA allows funds held in either a locked-in retirement account (“LIRA”) or a life income fund (“LIF”) to be unlocked and withdrawn for reasons of financial hardship in the following circumstances:

  • Low Income
  • Need to Pay Medical Expenses
  • Threat of Eviction for Rental Arrears
  • Threat of Default on a Mortgage on a Principal Residence
  • Need to pay a deposit to obtain a new Principal Rental Residence

• If I qualify for unlocking and withdrawal owing to financial hardship, what forms do I need to complete to release funds held in my LIRA or LIF?Permanent link to this section

  You will need to complete the Application to Unlock and Withdraw British Columbia Funds Due to Financial Hardship. If you have a spouse, your spouse will need to complete Form 1, “Spouse’s Waiver to Permit Benefits in a Pension Plan, Locked-in Retirement Account or Life Income Fund to be Unlocked.” This form is attached to the Application to Unlock and Withdraw British Columbia Funds Due to Financial Hardship.

• Where do I send the completed application for unlocking and withdrawal owing to financial hardship?Permanent link to this section

  You must send the completed application to the financial institution holding your locked-in funds. Do not send the application to the Superintendent of Pensions, as the Superintendent has no role in releasing funds for reasons of financial hardship.

• I am still employed and a member of my employer’s pension plan, but I am facing financial hardship. Can I unlock my pension funds in my employer pension plan?Permanent link to this section

  No. The PBSA allows only funds held in either a LIRA or a LIF to be unlocked and withdrawn for reasons of financial hardship.

• I am no longer employed by the company sponsoring the pension plan, but my money is still held in the pension fund. Can I unlock my pension funds for reasons of financial hardship?Permanent link to this section

  You must transfer the funds to either a LIRA or LIF before you may apply to have the funds released for reasons of financial hardship.

• I do not qualify for unlocking and release of funds owing to financial hardship. Are there other options that may be available to me?Permanent link to this section

  In addition to financial hardship, the PBSA provides four exceptions under which locked-in funds can be unlocked by the member.

  • Small Benefits
  • Age 65 and Small Entitlement
  • Permanent Departure from Canada
  • Commutation for Shortened Life Expectancy

  Please view the Information for Plan Members for more information.

• If I qualify to unlock my funds, what forms am I required to complete?Permanent link to this section

  The detailed information above will tell you which forms to complete under each exception. Please go to the exception that applies to your circumstance for the correct form required. Completed forms are filed with the financial institution holding your funds, or with your plan administrator.

• I do not qualify to unlock and withdraw funds for financial hardship and none of the other four exceptions apply to me. I was advised to call your office to get permission to unlock my funds from my LIRA or LIF. How do I do this?Permanent link to this section

  The PBSA does not provide the authority to the Superintendent of Pensions to unlock pension funds. Your pension funds can be unlocked only if you qualify for reasons of financial hardship or under one of the four exceptions above.