​Professional Advice: This document was prepared solely as a general guide and is not intended to provide or replace professional, legal or tax advice.
For your own specific situation, please consult your own tax and legal advisors.

Pension Transfers
Information rights
According to the Financial Services Commission of Ontario (FSCO), you should be aware of your pension rights. If your employment comes to an end before you reach retirement age, within 30 days of termination, the company pension plan administrator must provide you with a written statement that includes details about the benefits payable to you, the options you have, then possibly the common 60-day deadline for any decisions.

Transfer rights
Retirement NOW if your employment ends.
1-You can transfer the commuted value (lump sum) of your deferred pension out of your Company Pension Plan, to an “locked-in-plan.” The locked-in-plan is called a Life Income Fund (LIF) and you will receive your monthly pension income NOW.
2-You can leave the funds you have in the Company Pension Plan and you will receive your monthly pension income NOW.

Retirement LATER if your employment ends.
The Pension Plan Value must be transferred to:
1-Another employer sponsored pension plan that agrees to accept the transfer.
2-Transfer to a Locked-in Retirement Account (LIRA).
3-An insurance company LIRA for the purchase option of a GMWB Segregated Fund Plan or a Life Annuity, both payable at the time you are ready for your retirement monthly pension Later and i
ncome for life. Both of these LIRA’s options can have a 100% Pension Protection contract.

If you take your pension NOW, a Pension transfers to a LIF for monthly pension income NOW.
If you want your pension LATER, transfer to a LIRA, then transfer to a LIF for monthly pension income LATER.


Pension Options;

There are 4 options with your Pension if you leave your Company or the Company closes.

1- Leave the Pension with the current Company. Limited or no access to Lump Sums and increasing income, reduced monthly payment for your beneficiaries.

2- Purchase an Annuity. Limited or no access to Lump Sums and increasing income, reduced monthly payments for your beneficiaries.

3- Transfer to a LIRA. Access to Lump Sums. The availability to increase your income to Maximum Government Allowance.100% payment for beneficiaries.

4- Transfer to your new Company. Same is option #1. Locked back into a Company Plan.

Canadian Private Pension Plans;
Employer sponsored private pension plans provide an important source of retirement income for employees and their families. Employers generally set up pension plans voluntarily; however, once a pension plan is established, it must be funded and administered in compliance with applicable tax and pension laws as per Province.
Retirement plans for employees;
1- A Defined Benefit Pension Plan (DB) is a type of pension plan in which an employer promises a specified pension payment on retirement that is predetermined by a formula based on the employee's earnings, years of service and age.
2- A Defined Contribution (DC) Plan is a type of retirement plan in which the employer, employee or both make contributions on a regular basis. ... In DC plans, future benefits fluctuate on the basis of investment earnings and places the financial risk on the employee, which is becoming the normal type. No promises on a specified pension payment.

Beneficiaries for your Pension or LIRA
1-If you have a spouse at time of retirement, the law requires that you provide a surviving spouse benefit. This means your pension will be reduced, leaving money for the surviving spouse benefit. This requirement can be over ridden with spousal consent in the form of a signed waiver. Once this waiver is signed and submitted, you will be entitled to receive all of your pension income, but in case of your death there is no surviving spouse benefit. No pension income for your spouse.
2-In case of death prior to age 55, the Plan pays a benefit to your spouse or beneficiary equal to the value of your pension from your Normal retirement date as shown on your statement.

Pension held in a LIRA or a LIF
1-If the owner of a LIRA or LIF account dies, his/her surviving spouse will be able to transfer 100% of the survivor benefit directly, to his/her own RRSP or RIF (Retirement Income Fund), or a lump sum payment equal to the value of the LIRA on the date of death, where permitted by the Federal Tax Act.
2-If the Pension owner of the LIRA or LIF has no spouse at death, then the death benefit balance will instead go to a designated beneficiary or beneficiaries.
3-If there are no designated beneficiary or beneficiaries, then the balance will go to their estate. Death benefits are not locked in and may be paid out as cash, or the balance may be transferred to the recipient's own RRSP or RIF.

Pension Splitting
Retirement NOW-- Pension---LIF (Pension income payments)
Retirement LATER--Pension-----LIRA (Growth $ tank) ----LIF (Pension income payments)

Retirement Income NOW
At this time your Pension will be switched to a LIF for your monthly income payments.
Within the first 60 days of receiving your Pension, you have the option to transfer up to 50% into an RRSP. No RRSP contribution room needed for this transfer.

Retirement Income LATER
Pension transfers to a LIRA and remains there until you are ready for a Retirement Income after age 55.
Then at Retirement, within the first 60 days of switching your LIRA to a LIF, you have the option to transfer up to 50% into an RRSP.
Keep in mind that money in a LIRA is locked and is taken by monthly income. No additional withdrawals can be made.
If you decide to transfer some to an RRSP, that allows you to have accessibility to that money and withdraws can be made at any time, after the withholding tax is paid. (see below)

RRSP lump-sum withholding tax ra
tes in Ontario to deduct income tax:
10% on amounts withdrawn up to and including $5,000;
20% on amounts withdrawn over $5,001 
up to and including $15,000; and
30% on amounts withdrawn over $15,001
Government Website;