What Happens to My LIRA When I Move to the US? Can I Unlock It?

Canada doesn’t deem your LIRA sold when you leave, and in most places you can unlock it as a non-resident, usually about two years after you go. There’s no national rule though. Unlocking runs on pension legislation, provincial or federal depending on the account, and those rules genuinely differ: Ontario counts 24 months from your departure date, while Alberta’s guideline says nobody has to establish any set period, though a CRA non-residency letter still gates it there. Being allowed to unlock is one question. What a withdrawal costs is a different one.

What is a LIRA, and why can’t I just withdraw it like an RRSP?

Because a different body of law is holding it. A LIRA holds money that came out of a registered pension plan, and for income tax purposes it’s a registered retirement savings plan, which is why the federal rules call it a locked-in registered retirement savings plan. What makes it different from your ordinary RRSP is pension legislation, which restricts how that money can be used. Alberta’s Superintendent of Pensions puts the point plainly.

“Locking in is a restriction, imposed by the Act, on the use of funds originally accumulated in a pension plan. The purpose of locking-in is to ensure that a member’s pension benefit is used to secure a retirement income for that person and their pension partner (married or common-law) for both of their lives.” (Alberta Superintendent of Pensions, Interpretive Guideline #04)

Federally the same idea sits in section 18 of the Pension Benefits Standards Act, 1985, which requires a plan to provide that the benefit isn’t capable of being surrendered or commuted during the member’s lifetime. Your bank didn’t put that restriction there and can’t lift it. If what you’re holding is a plain RRSP or a TFSA, what an ordinary RRSP and TFSA do on the same move is the page you want instead.

Can I unlock my LIRA because I moved to the US?

In every jurisdiction checked on this page, yes, non-residency is a recognised unlocking ground. The conditions differ though, and so does the clock. Federally, a locked-in RRSP has to let a holder who has ceased to be a resident of Canada for at least two years withdraw any amount. Ontario, British Columbia, Manitoba, Quebec and Alberta each carry their own version, and Alberta’s requires no set period to be established. This is a permission, and it doesn’t tell you what the withdrawal costs.

“20 (1) A locked-in registered retirement savings plan shall provide that … (e) the holder of the locked-in registered retirement savings plan who has ceased to be a resident of Canada for at least two years may withdraw any amount from that plan” (Pension Benefits Standards Regulations, 1985, s.20(1)(e))

Money still sitting inside the pension plan runs on a different rule, section 28.4 of the same regulations, which counts two calendar years and treats you as resident for a year you sojourned in Canada 183 days or more. It also adds a condition the LIRA rule doesn’t have: you must have ceased employment or plan membership. And OSFI’s chart says the administrator “may release the funds but is not required to do so”, so that one isn’t yours to take on demand.

One divergence, recorded rather than smoothed over: OSFI’s chart runs the two calendar years and the 183-day sojourn rule across the locked-in RRSP row too, which s.20(1)(e) doesn’t say, and this page follows the regulation because it’s the more precise of the two.

Whose rules apply, and how much do they actually differ?

The pension law that governs the account, not the law of where you now live. Alberta’s guideline describes locking-in as applying to funds in a pension plan “and also to funds transferred from the plan” into a LIRA or LIF, so the restriction travels out of the plan with the money. And FSRA’s user guide to Form 5 tells applicants not to use that Ontario form where the account “is governed by the laws of the federal government or a province other than Ontario”, which is the regulator saying other regimes exist and yours sits under one of them. Finding out which is the first job.

Jurisdiction	The waiting period	What you have to produce	Source
Federal (PBSA plans)	Ceased to be a resident of Canada for at least two years for a locked-in RRSP or LIF; s.28.4 uses two calendar years for money still in a plan, with 183 days of sojourn making a year a resident year	OSFI’s chart says no prescribed form; if the money is still in a pension plan the administrator may release it but is not required to	PBSR ss.20(1)(e), 20.1(1)(n), 28.4 and OSFI
Ontario	Departure from Canada took place at least 24 months before the date of the application	FSRA’s Form 5, a written CRA determination that you’re a non-resident, and a spouse’s written consent or a certification that you have no spouse. Available at any age	FSRA’s user guide to Form 5 for the 24-month clock, and FSRA’s consumer page for the documents and the any-age point
British Columbia	Absent from Canada for 2 or more years	A signed statement of that absence, and under the mandatory LIRA addendum, written evidence that the CRA has confirmed non-resident status, plus a spouse’s signed Form 1 where there is a spouse	B.C. Reg. 71/2015, s.109 and Sch. 1 s.12
Manitoba	No longer a Canadian resident for at least two calendar years	A written request, written confirmation from the CRA that you qualify as a non-resident, and, unless the balance is a small amount, your spouse or common-law partner’s consent on the prescribed form	Manitoba Pension Commission
Quebec	Has not resided in Canada since at least 2 years	The standard LIRA contract must carry the term, and the regulation qualifies it: the right applies “unless the agreed to term of the investments has not expired”	Reg. respecting supplemental pension plans, s.29(8.1)
Alberta	The Superintendent’s guideline says nothing obliges the administrator or institution to establish that you’ve been a non-resident for any specific period	A written non-residency confirmation you apply for from the CRA, plus a signed pension partner waiver on Form 13 where you have a pension partner. The member must have ceased active membership and not started a pension	Alberta Interpretive Guideline #04, issued January 2015, and the province’s guide for individuals, updated January 2025, which states the same non-residency route with no waiting period

Those six are the ones checked for this page. Saskatchewan, Nova Scotia, New Brunswick, Newfoundland and Labrador, PEI and the territories run their own pension statutes and none of them was checked here, so treat the table as six answers rather than the map. Notice what most of these have in common: a written CRA determination, which is a thing you apply for and wait on. That application is usually a Form NR73, and whether to send the CRA one is its own decision, tied up with when your Canadian residence actually ended.

What does Canada take when I unlock and withdraw it?

Canada treats it as a payment out of an RRSP. Section 212(1) of the Income Tax Act charges a non-resident 25% on most amounts paid to them from Canada, and paragraph (l) puts RRSP payments inside that rule, so the institution holds the tax back before the money reaches you. The treaty’s 15% cap applies to a periodic pension payment, and Canadian law puts an RRSP payment before maturity outside that term. An unlocking lump sum therefore sits at 25%.

The conclusion only, because the sibling page carries the derivation: the treaty’s 15% cap is keyed to the defined term “periodic pension payment”, and Canadian law puts a pre-maturity RRSP payment outside that term (Income Tax Conventions Interpretation Act, s.5). The working is in lump sum versus periodic, once it’s no longer locked.

Unlocking and cashing out aren’t the same move, and that’s where people lose money by assuming they are. OSFI’s federal chart describes unlocked money as something that “may be withdrawn in cash or transferred to a tax-deferred savings vehicle such as an RRSP or a RRIF subject to any applicable income tax rules”. Alberta’s guide for individuals puts it flatter: take it as cash and tax is deducted, transfer it into an RRSP or RRIF and no tax is deducted. Both are written for someone still in Canada, so whether the transfer route lands the same way once you’re a US tax resident is a question for your own file. What the money costs to draw down after that is the 25% versus 15% decision, once it’s no longer locked.

How does the US treat a LIRA, and the money that comes out?

Carefully, because nothing we found names a LIRA. Rev. Proc. 2014-55 defines a “Canadian retirement plan” as any arrangement within the scope of Article XVIII(7) of the treaty, and the operative version of that paragraph reaches an arrangement resident in the other country, generally exempt from tax there, and operated exclusively to provide pension or employee benefits. Whether your LIRA fits those words is a reading. We looked for an IRS statement about a LIRA specifically and didn’t find one.

“A natural person who is a citizen or resident of a Contracting State and a beneficiary of a trust, company, organization or other arrangement that is a resident of the other Contracting State, generally exempt from income taxation in that other State and operated exclusively to provide pension or employee benefits may elect to defer taxation in the first-mentioned State … with respect to any income accrued in the plan but not distributed by the plan” (Fifth Protocol, Article 13(2), replacing Article XVIII(7))

So the position is conditional, and it should be written that way. Where the LIRA is within Article XVIII(7), the revenue procedure says a distribution must be included in gross income in the manner provided under section 72, subject to the treaty. Where it isn’t, the deferral question is open and belongs in a file-specific read. Either way the Canadian 25% doesn’t vanish: you claim it on Form 1116, where IRC 904(a) caps the credit at a proportion of your US tax tied to your foreign-source income, so a large single-year withdrawal doesn’t always come back dollar for dollar.

Is my LIRA caught by Canada’s departure tax?

It shouldn’t be. Ceasing Canadian residence deems you to have disposed of each property you own at fair market value, but section 128.1(4)(b)(iii) leaves an excluded right or interest out of that deemed sale, and section 128.1(10) puts a right under a registered retirement savings plan in that class. A LIRA registered as an RRSP sits there. Money still inside the pension plan itself lands in the same definition’s superannuation or pension fund or plan branch.

“excluded right or interest … means (a) a right of the individual under, or an interest of the individual in a trust governed by, (i) a registered retirement savings plan … (ii) a registered retirement income fund, … (viii) a superannuation or pension fund or plan (other than an employee benefit plan)” (ITA s.128.1(10))

That class is defined rather than illustrative, so the read depends on your account actually being registered as an RRSP, which the federal and Quebec rules require on their face. The rest of the deemed sale is what Canada does and doesn’t deem you to have sold on the way out.

What should I do next?

Three things, in this order. Ask the institution in writing which jurisdiction’s pension legislation governs the account, because everything else keys to that answer. Pin the date your Canadian residence actually ended, since most of these rules count from it. Then get the CRA determination moving early, because it’s the slowest item and it gates the application in most places.

None of that is hard. It’s just slow, and it’s cheaper to start early than to unwind later.

This guide is general information, not tax advice for your specific situation. Which points apply, and how, depends on your facts.