iAtoday

The Government of Nova Scotia has published the final version of Regulation 232/2024 amending the Pension Benefits Regulations (the Regulation). The changes to the Regulation follow the amendments made to the Act on April 5, 2024.

The changes will take effect on April 1, 2025. They introduce new unlocking rules for:

• Retired and inactive members of registered pension plans (RPPs) 
• Locked-in Retirement Accounts (LIRAs) and Life Income Funds (LIFs)

Changes applicable to RPPs will:

• Require the transmission of a statement every two years to inactive and retired members.
• Improve the quality of disclosure of the financial health of defined benefit (DB) RPPs on member statements by requiring clear information concerning transfer ratio.
• Extend the unlocking rules to retired members due to shortened life expectancy (if the plan allows it).
• Extend the unlocking rules to inactive members who have been non-residents of Canada for at least 2 years (if the plan allows it).

Changes applicable to LIFs

Other changes applicable to LIFs and LIRAs will:

• Allow members aged 55 and over to withdraw or transfer up to 50% of the funds held in their RPP, LIRA or old LIF during the first 60 days following the transfer to a new LIF (the regulator will publish a form to this effect).
• Eliminate temporary income for new LIFs.
• Change the minimum age for unlocking funds for old and new LIFs or LIRAs with a small amount (less than 50% of YMPE) from age 65 to age 55.
• Facilitate the unlocking of funds from old and new LIFs and LIRAs for members who have been non-residents of Canada for at least 2 years by replacing the mandatory Canada Revenue Agency (CRA) declaration with a written statement from the member.
• Eliminate the possibility of transferring assets to an old LIF.

Please note that we will not be informing plan sponsors and plan administrators of these changes directly. If you wish, you may advise your clients of these new rules.