Maximum amount transferable with no application for a temporary income (any age)
The holder of a life income fund (LIF) can transfer an amount from an
LIF to a registered retirement savings plan (RRSP) or a registered retirement income fund (RRIF), provided the transfer does not exceed the maximum allowed.
For
LIF holders who do not apply for a temporary income, the maximum amount transferable is equal to the difference between the life income ceiling and the mandatory minimum withdrawal, calculated as follows:
Maximum amount transferable
= life income ceiling – mandatory minimum withdrawal.
Note that...
- For the purposes of the calculation, the holder's age is determined as at 31 December of the year preceding the application for the transfer of an amount from an
LIF to an
RRSP or
RRIF.
- The transfer of an amount from an
LIF to an
RRSP is no longer possible after 31 December of the year in which the holder of an
LIF turns 71. At that point, an amount can only be transferred to an
RRIF.
- The
LIF QuickCalc online service enables you to calculate a life income.
- The Canada Revenue Agency sets the minimum yearly amount to be withdrawn from an
LIF, which corresponds to the
minimum amount to be withdrawn from an
RRIF
. The minimum is $0 the year in which the LIF is opened.
A helpful example...
| Mark's age on 31 December 2022: | 60 years |
|
LIF balance: | $300 000 |
| Life income ceiling: | $20 100 |
| Mandatory minimum withdrawal: | $10 000 |
Maximum amount transferable from an
LIF to an
RRSP or
RRIF
= life income ceiling – mandatory minimum withdrawal
= $20 100 - $10 000
= $10 100
In
2023, the maximum income that Mark can draw from his
LIF is $20 100. He must withdraw a minimum of $10 000. He can transfer a maximum of $10 100 to an
RRSP or
RRIF.