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As stated above, for 2020, the government passed legislation as part of its COVID-19 response plan that decreased the required minimum withdrawals from RRIFs by 25 per cent. For example, if you were 71 as of Jan. 1, 2020, you would only need to withdraw 3.96 per cent of the opening balance, rather than 5.28 per cent. The lower minimum withdrawal factors also apply to Life Income Funds (LIFs) and other locked-in RRIFs. If you have already withdrawn more than the temporarily-lowered minimum amount in 2020, unfortunately, you can’t recontribute any excess back to your RRIF.
For those who regularly take out their RRIF minimums in December, now is a good time to double-check with your RRIF provider if you want to take advantage of the lower withdrawal amount for 2020. Note that this lowered RRIF minimum only applies for this year, so the regular RRIF withdrawal factors will apply again starting in 2021.
Of course, you always have the option to withdraw unlimited amounts from your RRIF, unless it is a locked-in plan that was created by a transfer of funds from a registered pension plan. Locked-in retirement funds include a life income fund (LIF), locked-in retirement income fund (LRIF), and a prescribed RIF (PRIF). The maximum amount that you can withdraw from a locked-in fund depends on the specific legislation, but, should you meet the specific conditions under the applicable pension legislation, you may be eligible to withdraw additional funds from a locked-in plan in cases of shortened life expectancy, financial hardship, or where there is a small plan balance.
