The Locked-In Retirement Account (LIRA) and Locked-In Retirement Savings Plan (LRSP) enable you, as an employee to maintain the tax-deferred status of pension plan proceeds received when you leave a company. LIRA's lock in your money, but not your investment options. These plans are governed by federal or provincial pension legislation.
The LIRA can receive pension proceeds if the planholder earned the pension while working in a province other than B.C., Nova Scotia, or P.E.I.
P.E.I. has not yet established its own pension legislation, therefore any locked-in plans from P.E.I. must be handled individually
All money in locked-in plans must come from your Registered Pension Plan (RPP) or from another locked-in plan. You can’t make additional contributions, but you can decide how your money is invested.
The LIRA or LRSP must be collapsed in the year in which you have your 71st birthday. You can then:
Purchase an annuity, or
Transfer the assets to a LIF or LRIF, depending on the pension legislation governing the LIRA or LRSP