Family Law related FAQs – Locked-in Accounts

Q600. Are there any FSCO forms that must be used for the parties to request division of money held in Ontario locked-in accounts upon marriage breakdown?


A600. No, there are no FSCO forms to be used for money held in Ontario locked-in accounts, such as LIRAs (locked-in retirement accounts) or LIFs (life income funds). Check with your financial institution to see if they have their own forms to be used for this purpose. -03/2015
Q601. If money held in a LIF is to be divided upon marriage breakdown, what are the options available to the former spouse of a LIF owner?
A601. Generally, money held in a LIF (life income fund) cannot be transferred to a LIRA (locked-in retirement account), as described in FSCO’s pension policy - Schedule 1.1 Life Income Funds (New LIFs). However, money that is transferred from an owner’s LIF to the LIRA of a former spouse as part of a marriage breakdown property division settlement is an exception to this rule.
In the case of a marriage breakdown property division settlement, the former spouse may transfer his or her share of the LIF to a LIRA or to his or her own LIF. (Note: The earliest date a former spouse may buy a LIF is anytime during the calendar year before the year he or she turns 55 years of age.)
The former spouse may also transfer his or her share of the LIF to an insurance company to purchase a life annuity or to another pension plan registered under the pension benefits legislation in any jurisdiction in Canada or provided by a government in Canada if the administrator of the other plan agrees to accept the transfer. -03/2015
Q602.  When I got divorced, I transferred my share of my former spouse’s pension benefit to a LIRA. I am now remarried and would like to purchase a LIF. Do I need my new spouse’s consent to purchase the LIF?
A602. No. You do not need your new spouse’s consent to purchase the LIF (life income fund) since none of the money in your LIRA (locked-in retirement account) came from your own pension plan, but from the pension plan of your former spouse. -03/2015
Q603. If the pension assets were held in a LIRA or a LIF on the Family Law Valuation Date, what is the maximum share that may be transferred to the owner’s former spouse?
A603. The former spouse’s share cannot exceed 50 percent of the assets held in the LIRA (locked-in retirement account) or LIF (life income fund) determined as of the Family Law Valuation Date. The rules for the division of LIRA and LIF are set out in Schedules 3 and 1.1 to General Regulation 909, respectively. -03/2015
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