This page provides answers to questions that owners/applicants may have about the financial hardship unlocking rules and process effective January 1, 2014.
Inquiries or clarifications on a specific application should be directed to the financial institution that holds and administers the locked-in account.
Part 1 - Questions that apply to all applications and forms
Applications and forms
Transition questions – 2013 to 2014
Responsibility for processing applications
Refusing an application
Deadlines and timelines
Minimum amounts that can be applied for and withdrawn
Maximum amounts that can be applied for and withdrawn
Withholding tax and deduction of additional amounts
Payment of approved amount
Part 2 - Questions about specific categories of financial hardship
Medical expenses - Form 1
Arrears of rent or debt secured on a principal residence (such as a mortgage) - Form 2
First and last months’ rent - Form 3
Low expected income - Form 4
Part 1 – Questions that apply to all applications and forms
Applications and forms
Q1. Who do I submit my application to?
A1. You must submit your application directly to the financial institution that holds your locked-in account. Do not submit your application to FSCO. -03/14
Q2. Where can I find the new 2014 application forms?
A2. The 2014 application forms that must be used for each category should be available from your financial institution, or can be found on the special page on FSCO's
website. Hard copies are also available at FSCO’s offices at 5160 Yonge Street, 8th floor, Toronto, Ontario.
Q3. Can I modify a 2013 form and use that?
The 2013 forms do not reflect the current requirements for financial hardship unlocking and cannot be modified and used. An application submitted on a pre-2014 form should be returned to the applicant.
Q4. What does each application relate to?
A4. Each application relates to one locked-in account for the year in question.
You may apply once each year under each category from any locked-in account you own. For the medical expenses category, you may make one application each calendar year for each person who is suffering from an illness or physical disability as long as that person is (1) the owner (yourself), (2) the owner’s spouse, or (3) a dependant of the owner or the owner’s spouse. -03/14
Q5. How many applications can I make each year?
A5. You may make one application under each category per year, except for the medical expenses category (see previous question and answer). -03/14
Q6. May I apply under different categories of financial hardship at the same time?
A6. Yes, but each application must be made on a separate form. -03/14
Q7. May I apply for financial hardship unlocking and another type of non-financial hardship unlocking, such as small amounts at 55 or shortened life expectancy, at the same time?
A7. Yes, but each application must be made on a different form. The financial hardship application must be made on one of the financial hardship unlocking forms depending on the category (FHU 1, 2, 3 or 4), and the non-financial hardship application must be made on FSCO pension Form 5. Both applications must be made to the financial institution. -03/14
Q8. If an application is refused, may I apply again under the same category in the same year?
A8. No. Each person is entitled to one application per year for each account, regardless of whether it is approved or refused. -03/14
Transition Questions – 2013 to 2014
Q9. I received a consent from the Superintendent of Financial Services under the old rules in 2013 but I have not submitted it to my financial institution yet.
Can I submit the consent in 2014?
Can my financial institution accept it?
And if they do accept it, can I apply again under the new rules in 2014?
A9. Yes. Under the old rules, individuals who have received a consent from the Superintendent in 2013 have 12 months from the date the consent was signed to submit it to their financial institution. The application is considered to have been made in 2013, and the individual can apply again in 2014 under the new rules, using a 2014 form. -03/14
Responsibility for processing applications
Q10. Who is responsible for processing my application?
A10. The financial institution that administers your locked-in account is responsible for reviewing the application, determining whether the requirements set out in the Regulation are met, answering your questions, advising you in writing if the application is refused, and paying the money to you within the prescribed time period if the application is successful. -03/14
Q11. Must my application and supporting documents be notarized?
A11. No. Neither the Pension Benefits Act nor Regulation requires that an application or supporting documents be notarized. The form does require that certain signatures be witnessed. -03/14
Refusing an Application
Q12. If I have a locked-in account with a financial institution, may that financial institution refuse to review an application for financial hardship unlocking?
A12. No. A financial institution must review your application if it holds the locked-in account. -03/14
Q13. What happens if my application is not complete?
Must the financial institution refuse it?
A13. The financial institution should advise you that your application is incomplete and you should be given an opportunity to complete it. -03/14
Q14. What are some grounds for refusing an application?
A14. A complete application must be refused if it does not meet the requirements of the Regulation. It is the financial institution’s responsibility to review the application to ensure that it meets all requirements. The following are some examples of where the requirements will not be met and the application refused:
Any documents required by the applicable category to accompany the application have not been submitted or do not meet the requirements of the category.
The locked-in account is not held by the financial institution.
The money was not earned in Ontario regulated employment.
The applicant is not the owner of the account.
The owner has already made an application under that category during that calendar year with respect to that account (or for medical expenses has already made an application under that category during that calendar year in respect of that particular person).
The owner applies to withdraw an amount that is less than $500.
The maximum amount permitted under the category is less than $500.
The owner applies to withdraw an amount that is greater than the maximum permitted under the category.
There is no spousal consent to the withdrawal (and one is required in the circumstances).
The spouse who signs the consent is not the spouse identified in Part 1 of the application.
The owner certification or the spousal consent is dated more than 60 days before the date the financial institution receives the form.
The owner does not use the Superintendent approved form for the correct category of financial hardship.
The spouse’s signature is not witnessed by an adult who is not the owner of the locked-in account.
Please note that these are only examples; it is not a comprehensive list.
Q15. What actions should a financial institution take when it refuses an application?
A15. When an application is refused, the financial institution should advise the applicant in writing and explain the reason for the refusal. -03/14
Q16. If my application is refused by my financial institution, or if I do not agree with the amount that has been approved, what steps should I take?
What steps should the financial institution take?
A16. If you do not agree with the refusal or do not agree with the amount that has been approved, you should ask your financial institution to explain its decision to you. If you are still not satisfied, you should contact FSCO. -03/14
Deadlines and timelines
Q17. What are the key timing considerations for making applications?
A17. The owner of the locked-in account has 60 days from the date he or she signs the certification in the application (Part 3) and his or her spouse signs the consent, if applicable (Part 4) to submit the application to the financial institution. If the application was signed by either the owner or the spouse more than 60 days before the date it was received by the financial institution, the application is a nullity.
In addition, certain required statements or documents cannot be signed and dated more than 12 months before the financial institution receives it. If the statement or document is dated more than 12 months before, the statement or document cannot be accepted. The financial institution should give the applicant an opportunity to provide a new statement that complies with the 12-month timeline. -03/14
Q18. What are the key timing considerations for processing applications?
A18. Once a financial institution receives a complete application including all required accompanying documents, it has 30 days in which to review the application and, if it is approved, to pay out the money. In determining the 30 day time limit, the date of receipt is excluded and the date of payment is included.
For example, a financial institution receives a complete application and all required documents on September 15 and approves it on the same day. The money must be paid within 30 days of September 15, which is October 15 – you begin counting on the next day, September 16. If the application is complete but the financial institution does not approve it until September 25, the money must still be paid by October 15 as the 30-day period began September 15, the date of receipt. -03/14
Q19. What happens if an application is not complete?
A19. The 30-day “clock” begins on the date the application is received. If the application is incomplete, the 30-day clock stops and is “reset to zero” on the date the financial institution discovers that the application is incomplete and advises the applicant. When the applicant provides the missing information or document, the 30-day clock begins anew.
For example, an application is received by a financial institution on May 1. The financial institution must make the payment within 30 days from May 1, which would be no later than May 31. Assume that the financial institution reviews the application on May 7 and determines that the application is incomplete – it may be missing a signature or there might not be a necessary accompanying document. At that point, the 30 day “clock” is stopped and is reset to zero. The financial institution should contact the applicant and advise him or her to provide the missing information or document. When the applicant does so, the 30 day clock begins anew. -03/14
Minimum amounts that can be applied for and withdrawn
The minimum amount that can be withdrawn is $500.
What happens if I apply for $500 (or more) but have less than $500 in my account when my application is approved?
A20. The Regulation provides that the minimum amount that may be withdrawn is $500. If you have less than $500 in your account when you application is approved, no money can be paid from your account. -03/14
Maximum amounts that can be applied for and withdrawn
Q21. I have filled out my application and the maximum amount I can withdraw is less than $500.
Can I withdraw the lesser amount?
A21. No. If the maximum amount that may be withdrawn is less than $500, no money can be paid from the account. -03/14
Q22. In calculating the maximum amount an individual can apply for, must the financial institution take into account the total of all the monies in all the applicant’s locked-in accounts?
A22. No. Each application relates only to the locked-in account from which the individual is applying to withdraw money. -03/14
Q23. If my application is approved for a certain amount, can I withdraw some of the money immediately and withdraw the remainder later?
A23. No, there is no authority for partial payments. All the money must be paid out in full once the application is approved (and within 30 days of the receipt of the completed application with all required accompanying documents). -03/14
Q24. If the maximum amount I am allowed to withdraw is $6,000 and I have $3,000 in one account and $3,000 in another account, can I make one application for $6,000 and be paid from both accounts?
A24. No. Each application relates to only one account. You would have to first combine the two accounts and then make your application or make separate applications with respect to each account. -03/14
Q25. Can an individual apply for more than the amount he or she has in his account on the date of the application, assuming that the amount applied for is less than the maximum?
How should the financial institution process such an application?
A25. If an applicant applies for an amount greater than the amount in the account on the date of the application, the financial institution may request the applicant to amend the application. If the applicant does not do so, the application must be refused. -03/14
Q26. What constitutes an adult witness for the certification?
A26. A person 18 years or older who is not a dependant or spouse of the applicant. -03/14
Q27. Can my spouse or dependant witness my certification?
A27. No. If your spouse or dependant is the witness, the financial institution should advise you to sign again in the presence of another witness. -03/14
Q28. Can I witness my spouse’s consent?
A28. No. -03/14
Q29. Can an employee of the financial institution be a witness?
A29. Yes, a financial institution employee can witness the owner’s certification or the spouse’s consent. -03/14
Withholding tax and deduction of additional amounts
Q30. My application was approved for a certain amount but then my financial institution deducted a percentage for withholding tax.
Are they allowed to do this?
A30. The financial institution is required to deduct withholding tax when a payment is made from a locked-in account. Under the rules that came into force on January 1, 2014, the amount that is approved is the total amount that may be withdrawn from the account. The financial institution must deduct the amount of withholding tax from the approved amount and pay the balance to you. -03/14
Q31. Can I be reimbursed for the amount that was held back for withholding tax?
A31. You should ask the Canada Revenue Agency for information on reimbursement of withholding tax. -03/14
Q32. Can a financial institution charge an administrative fee?
A32. The Pension Benefits Act and Regulation do not prohibit the charging of administrative fees. -03/14
Q33. If a financial institution charges an administrative fee, should that amount be deducted from the amount that is paid to me (the owner)?
A33. The amount approved is the total amount that may be withdrawn from the account. Therefore, if the financial institution charges an administrative fee, that amount must be deducted from the amount that is withdrawn from the account unless it is paid by you directly. -03/14
Payment of Approved Amount
Q34. When an application has been approved, must the amount approved be paid in cash to the owner or can some or all of the money be transferred to an RRSP or RRIF?
A34. The regulation provides that the owner may withdraw an amount from the locked-in account that has been approved, which means that the amount must be paid out in cash. A transfer of the full amount or any portion of the approved amount to an RRSP or RRIF is not permitted. -03/14
Part 2 – Questions about specific categories of financial hardship
FHU Form 1 - Medical Expenses
Q35. Whose medical expenses can be covered under the application?
A35. An application to withdraw money from a locked-in account for financial hardship for medical expenses may relate to an illness or physical disability of (1) the owner of the locked-in account; (2) the owner’s spouse; or (3) a dependant of the owner or a dependant of the owner’s spouse. The application must be made by the owner of the locked-in account. -03/14
Q36. May an owner apply under the medical expenses category for more than one person during the same year?
A36. Yes, as long as the medical expenses relate to the owner, the owner’s spouse or a dependant of the owner or owner’s spouse. -03/14
Q37. If the owner is applying for medical expenses for different persons in the same calendar year, must the owner make a separate application for each person?
A37. Yes. An owner may make applications under the medical expenses category for any of the eligible persons in the same calendar year, but separate forms for each person must be used. In addition, there must be separate supporting documents and certifications from a physician or dentist. -03/14
Q38. May an individual apply for medical expenses that were incurred in the past?
Is there a time limit?
A38. As long as a physician or dentist certifies that the medical expenses are or were necessary for the person’s treatment, they may be included in the application.
However, there is a time limit for the supporting document(s) provided along with the application. The application would not be valid in the following circumstances:
- where the supporting document must be signed by the owner or his/her spouse, and is signed by either of them more than 60 days before the financial institution receives it;
- in all other cases, where the supporting document is signed or dated more than 12 months before the financial institution receives it. – (08/2017)
Q39. Must the subject of the application be suffering from an illness or physical disability at the time the application is signed?
A39. The Regulation does not require that the individual have the illness or physical disability at the time the application is signed. -03/14
Q40. May medical expenses that are required for a person suffering from a mental illness be included?
A40. Yes. A person suffering from a mental illness can claim for medical expenses. The physician or dentist must certify that the medical expenses are or were necessary for the person’s treatment. -03/14
Q41. If the owner and his or her spouse are living in separate residences but their spousal relationship has not broken down, can the owner make an application under medical expenses if his or her spouse is suffering from an illness or physical disability?
A41. Yes. However, the medical expenses cannot be made for renovations to the spouse’s principal residence. -03/14
Q42. How is a “dependant” defined for the purpose of this application?
A42. A dependant is any person who was dependent for support on either the owner of the locked-in account or on the owner’s spouse at some time during the calendar year in which the owner signs the application or during the previous calendar year. -03/14
Q43. Does a dependant have to reside in the same residence as the owner or spouse?
A43. No. The dependant is not required to reside at the same residence as the owner or the owner’s spouse. -03/14
Q44. Is there an age limit for a dependant?
A44. No, there is no age limit for dependants set out in the Regulation. -03/14
Q45. May an individual apply for future renovations for medical reasons to a principal residence he or she is currently living in?
What supporting documents should be submitted?
A45. Yes, future renovations to the owner’s or the dependant’s existing principal residence may be included if they are made necessary by the illness or physical disability of the owner, his or her spouse or a dependant, as verified by a physician or dentist licensed to practice medicine or dentistry, as the case may be, in a jurisdiction in Canada.
The applicant must submit an estimate to account for the total cost of the renovations being claimed. The estimate should be dated, show the proposed amount to be paid and what work must be done. -03/14
Q46. May an individual apply for renovations for medical reasons to a principal residence he or she does not yet live in?
For example, if he or she intends to move into a new home that requires renovations for a medical reason, can those expenses be covered?
A46. No. The Regulations distinguish between expenses for renovations for an existing principal residence and additional expenses in the construction of a future principal residence. However, once the owner or dependant moves into the new home and it becomes his or her principal residence, an application may be made for additional expenses that were incurred in the construction of the principal residence made necessary by the illness or physical disability of the account owner, his or her spouse or a dependant. -03/14
Q47. What constitutes an acceptable receipt for a medical expense?
A47. Medical receipts should be signed and dated, show the amount paid and to whom the amount was paid, and should identify the product or service for which it was given. It is up to each financial institution to determine if a receipt is acceptable. -03/14
Q48. Must the physician or dentist’s certification be made within a certain time period?
A48. The certification cannot be signed or dated more than 12 months before the date the financial institution receives the application. -03/14
FHU Form 2 - Arrears of Rent or Mortgage (Secured Debt)
Q49. What kind of demand must have been received and by whom?
A49. 1. The owner of the account or the owner’s spouse must have received a written demand for:
a) payment of arrears of rent on the owner’s principal residence; or
payment in respect of a default on a debt secured against the owner’s principal residence;
2. the owner could face eviction if the arrears or debt remains unpaid.
The demand must be in writing; a verbal demand is not sufficient. -03/14
Q50. Who must face eviction?
Can it be the spouse?
A50. The owner must be the person who could face eviction from his principal residence, not the owner’s spouse. If both the owner and the spouse could face eviction, that would qualify. -03/14
Q51. Who can receive the written demand for payment?
A51. The written demand can be received by the owner of the principal residence or the owner’s spouse but the owner must be the one who could face eviction. -03/14
Form 2 refers to a “secured debt (mortgage)”. Does this mean that only a mortgage can be considered a “secured debt” under this category?
No. The Regulation provides that an owner or his or her spouse must have received “a written demand in respect of a default on a debt that is secured against the owner’s principal residence”.
A mortgage may be the most common example of a debt secured against a principal residence but there are others. The financial institution must determine whether the debt the applicant is facing qualifies as a “debt that is secured against the owner’s principal residence”.
Q53. What are some examples of a secured debt against a principal residence?
A53. Examples of debts secured against a principal residence include a mortgage on the principal residence, a line of credit secured against the principal residence, and a lien registered against the principal residence. There may be other types of secured debt; each financial institution should ask its legal advisors if it is unsure. -03/14
Q54. What is a principal residence for the purpose of this application?
A54. A principal residence means in respect of an individual, the premises, including a non-seasonal mobile home that is occupied by the individual as his or her primary place of residence. -03/14
Q55. The written demand for payment must relate to the principal residence of the owner.
What if the spouses are living in different residences?
A55. The written demand for payment may only relate to the owner’s principal residence, not the spouse’s principal residence (if it is different from the owner’s). -03/14
Q56. What if the owner’s principal residence is owned by the spouse or the spouse’s name is on the rental agreement?
A56. The application may still be approved as long as it is the owner’s principal residence and either the owner or his or her spouse received the written demand. -03/14
Q57. If a person is approved for arrears of rent in a calendar year, and subsequently moves and falls into rent arrears for a different principal residence in the same year, can he or she apply again from the same locked-in account?
A57. No. Only one application under this category may be made during a calendar year. -03/14
Q58. What information should be included in the written demand for arrears of payment of rent or default on a secured debt?
A58. The demand should state the name of the person who is in arrears; the total amount of arrears in the payment of rent on the owner’s principal residence or the total amount of the default on the debt secured against the owner’s principal residence; and the address of the owner’s principal residence. -03/14
Q59. Can arrears of rent include any costs to the landlord, including any cost to cover the landlord’s application with the Landlord and Tenant Board?
No. the Regulation does not provide for the inclusion of any costs to the landlord.
Q60. In box 2b under Part 2, if the applicant enters an amount that includes the cost of future payments of rent or a mortgage in addition to the amount of arrears, the total amount will be greater than the amount set out in the written demand. Can the amount in box 2b be greater than the amount in the written demand?
Yes. The amount in box 2b would include the sum of the total arrears and future payments for a period of 12 months after the date the application is signed.
FHU Form 3 – First and Last Months’ Rent
Q61. Must the first and last months’ rent be to obtain a principal residence for the owner or can it be to obtain a principal residence for the owner’s spouse?
A61. The first and last months’ rent must be needed to obtain a principal residence for the owner. It is acceptable if the owner and spouse both live in the residence. -03/14
Q62. What if the spouse enters into the rental agreement?
A62. Either the owner or his or her spouse may require the money to pay the first and last months’ rent (i.e., either one’s name may be on the rental agreement) as long as the premises are intended to be occupied by the owner as his or her principal residence. -03/14
Q63. If a person has been approved for first and last months’ rent and is paid a certain amount, and he or she then moves and requires first and last months’ rent for another residence in the same calendar year, may he or she apply again from the same locked-in account?
A63. No. An individual may make only one application per calendar year for first and last months’ rent. -03/14
Q64. If the applicant has a rental agreement, must it be included with the application?
May a financial institution require a rental agreement?
A64. The Regulation provides that if a rental agreement is available, it must be included with the application. However, it is not necessary for there to be a rental agreement to approve the application. A financial institution cannot require an applicant to produce a rental agreement. -03/14
FHU Form 4 – Low Expected Income
Q65. Must I provide any evidence about the amount of my expected total income for the 12 months following the date I sign the application?
A65. No. The Regulation requires the owner to provide a statement, signed by the owner, setting out the amount of his or her expected total income from all sources, before taxes, for the 12 months after the date on which the application is signed. The Regulation does not require the owner to provide any evidence to support this statement. -03/14
Q66. In determining the expected total income for the next 12 months, should I include the amount I am applying for under this category?
A66. No. The amount you are applying to withdraw under this category should not be included. -03/14
Q67. Should the amount I fill in for my expected income include any deduction of taxes?
A67. No. All amounts entered into the form should be before any deduction of taxes. -03/14
Q68. Should I include any amount my spouse expects to receive?
A68. No. Do not include any income your spouse expects to receive. -03/14
Q69. How can I determine whether an amount should or should not be included as expected total income?
A69. The Regulation sets out certain amounts that are not included in an owner’s expected total income from all sources before taxes.
The following amounts should be included in determining your expected total income for the next 12 months:
wages, salaries, casual earnings and amounts paid under a training program (gross amount, before taxes);
income from self-employment (excluding expenses but before taxes);
rental income (excluding expenses but before taxes);
payments received under an annuity, pension plan, registered retirement savings plan, registered retirement income fund, superannuation scheme, or earnings replacement program;
spousal support payments;
capital gains arising from the sale or disposition of an asset;
cash payments received under a government program (except for those excluded below), such as Canada Pension Plan, Old Age Security, or Ontario Works;
interest and dividend income on any investment; and
income from any other source.
The following payments should not be included in your estimate:
the amount you expect to withdraw under the low income category;
a refund or repayment of taxes;
a refundable tax credit;
a refund of tax paid under the Ontario Child Care Supplement for Working Families program (under section 8.5 of the Income Tax Act);
the payment to you of an Ontario child benefit (under section 8.6.2 of the Income Tax Act or under section 104 of the Taxation Act, 2007);
a payment received by a foster parent under the Child and Family Services Act; or
child support payments received under a court order or an agreement. -03/14
Q70. Where can I get further information about financial hardship unlocking?
A70. Please go to FSCO’s
website for further information about financial hardship unlocking. -03/14