Portability Options

On cessation of membership or plan termination, members not yet eligible to retire (or their survivors) are, except where the exercise of portability impairs the solvency of the plan, entitled to all portability options described in the PBSA and the Pension Benefits Standards Regulations (PBSR). Members eligible to retire (or survivors) may be entitled to these portability options depending on the terms of the plan. Terminating members (or survivors) must be provided with their options within 30 days of ceasing membership in the plan and must be given at least 60 days to choose an option.

The transfer options available to members (or survivors) are:

• A cash refund if the pension benefit credit is not locked-in;
• Transfer of the pension benefit credit to another pension plan willing to accept the funds;
• Transfer of the pension benefit credit to a locked-in Registered Retirement Savings Plan (RRSP) or Life Income Fund (LIF), or Restricted Life Income Fund (RLIF), or
• Purchase an immediate or a deferred life annuity.

The Income Tax Act imposes a limit on the amount of money that can be transferred on a tax-sheltered basis and the PBSA permits the amount in excess of this limit to be unlocked and transferred out in cash.