In this article:
Overview
You can withdraw funds from your LIF through your Wealthsimple account. A LIF has both a minimum and maximum amount you must withdraw each year, set by the government. We'll help you stay within these limits when you make a withdrawal.
It's important to withdraw your minimum amount by the end of each calendar year. The Canada Revenue Agency (CRA) requires us to make the withdrawal for you if you don't.
Find your minimum and maximum withdrawal amounts
You can find your yearly minimum and maximum withdrawal amounts in your Wealthsimple account:
- Log in to the Wealthsimple app
- Tap the Move tab at the bottom of your screen
- Tap Move money
- Select your LIF as the source account
- Choose the destination for your withdrawal
- Tap Next
- Review how LIF withdrawals work
- Tap Next
- You'll see your Yearly minimum remaining, which is the amount you must withdraw by the end of the calendar year
- Log in to your Wealthsimple profile on a laptop or computer
- Select the Move tab
- Select Transfer money
- In the From field, select your LIF
- You'll see your minimum and maximum withdrawal amount
How to make a withdrawal
When you make a withdrawal from an LIF, you can choose whether to withdraw your annual minimum amount, your annual maximum amount, or another amount within your limits. You must withdraw at least the minimum amount by the end of the calendar year. Any amount greater than your minimum withdrawal will be subject to withholding tax.
Follow these steps to make a withdrawal:
- Log in to the Wealthsimple app
- Tap the Move tab at the bottom of your screen
- Under Move money, tap Transfer money
- In the From field, select your LIF
- Choose the destination for your withdrawal
- Tap Next
- Choose a withdrawal mode: Withdraw Minimum, Withdraw Maximum, or Choose Your Own Amount
- For Withdraw Minimum or Withdraw Maximum, your amount and withholding tax are pre-filled and can't be changed.
- For Choose Your Own Amount, you can set your own amount and withholding tax, within your limits.
- If your account holds both CAD and USD, use the currency toggle to choose which to withdraw. Choosing USD sets your withdrawal to a one-time transaction: recurring and post-dated withdrawals are only available in CAD, since the exchange rate can only be set at the moment of the transaction.
- Review your withdrawal details. For USD withdrawals, the Taxes amount is shown in USD, with a secondary Reported Amount line showing the CAD-converted figure.
- Tap Confirm
- Log in to your Wealthsimple profile on a laptop or computer
- Select the Move tab
- Select Transfer money
- In the From field, select your LIF
- In the To field, select your desired linked bank account
- Choose a withdrawal mode: Withdraw Minimum, Withdraw Maximum, or Choose Your Own Amount
- For Withdraw Minimum or Withdraw Maximum, your amount and withholding tax are pre-filled and can't be changed.
- For Choose Your Own Amount, you can set your own amount and withholding tax, within your limits.
- If your account holds both CAD and USD, use the currency toggle to choose which to withdraw. Choosing USD sets your withdrawal to a one-time transaction: recurring and post-dated withdrawals are only available in CAD, since the exchange rate can only be set at the moment of the transaction.
- Select Next
- Confirm your withdrawal details
- Select Submit
Multiple withdrawals
Per Canada Revenue Agency’s (CRA) general anti-avoidance guidance, where it appears that an annuitant is making separate taxable withdrawals from an RRSP/FHSA/RRIF/LIF to minimize the income tax withheld, for example, where a series of requests are made in a short period of time, it is the CRA's position that the withholding rate should be determined as if multiple withdrawals were combined into a larger lump sum. Thus, a higher withholding tax rate could apply.
Withdrawing more than your minimum amount
If you withdraw more than your yearly minimum amount, the extra funds are subject to a withholding tax. We automatically deduct this tax from your withdrawal and send it to the government. The amount of withholding tax depends on your province of residence.
| If you withdraw: | Withholding tax rate (excluding Quebec): | Withholding tax rate (Quebec residents): |
|---|---|---|
| Up to $5,000 | 10% | 19% (5% Federal + 14% Provincial) |
| Between $5,001 and $15,000 | 20% | 24% (10% Federal + 14% Provincial) |
| More than $15,001 | 30% | 29% (15% Federal + 14% Provincial) |
LIRA to LIF conversion considerations
When you convert your Locked-in Retirement Account (LIRA) to a LIF, you aren't required to make a minimum withdrawal in that calendar year. Any withdrawals you make in this conversion year are subject to withholding tax.
There also won't be an automatic maximum withdrawal limit set up for your account in the year you convert your LIRA to a LIF. If you wish to make a withdrawal, we'll need to manually generate this maximum for you. Please contact our support team so that we can provide you with the maximum amount for the year and help you set up your withdrawal.
The following calendar year, you'll be required to withdraw the minimum amount, which won't be subject to withholding tax. Any amount withdrawn over the minimum in the next calendar year will be subject to withholding tax.
Understand Quebec LIF changes
The Province of Quebec has introduced significant changes to the LIF payment regulations, which came into effect on January 1, 2025.
Highlights of the changes:
- There's no upper limit related to withdrawals (no maximum income) for annuitants aged 55 or over at the time of withdrawal application. The minimum amount remains unchanged.
- No amount can be directly transferred from a LIF to an RRSP, a RRIF, or a non-locked-in account under a voluntary retirement savings plan (VRSP).
- You can no longer request a refund of the balance (unlocking) of a life income fund (LIF) in either of the following two situations:
- Small amount unlocking: You're 65 and over, and the total of the locked-in amounts accrued does not exceed 40% of the maximum pensionable earnings of the year.
- Non-resident unlocking: You haven't lived in Canada for at least 2 years.
For more details, please review the following link from Retraite Québec: Amendments related to LIFs as of 2025.
Frequently asked questions
Why do I need to withdraw my minimum before an internal transfer?
This is a requirement mandated by the CRA that Wealthsimple must follow when processing your internal transfer request.
Can I internally transfer from my LIF to another Wealthsimple account instead of an external bank account?
You can move funds from your LIF to eligible account types by following the withdrawal steps above.
Can I transfer between two LIF accounts?
Not currently, regardless of currency.
Can I hold or withdraw US dollars from my LIF?
If you have a self-directed LIF, yes. This isn't yet available for managed accounts.
Will I still be charged FX fees on USD in my LIF account?
No. You won't pay FX fees to hold US dollars, trade US-listed securities, or make internal transfers in USD in this account.
Can I set up a recurring US dollar withdrawal?
Not yet. Because the exchange rate is only set at the moment of your transaction, USD withdrawals can only be made one at a time. You can still set up a recurring withdrawal in Canadian dollars.
Can I withdraw US dollars directly to my bank account?
Yes. You can transfer your USD to another Wealthsimple account, or withdraw it directly to a USD bank account.
Comments
0 comments
Please sign in to leave a comment.