To complete Form T2151, the CRA’s direct transfer form for moving a lump sum out of a Registered Pension Plan or a Deferred Profit Sharing Plan, you fill out Section I with your personal details and the receiving plan information, sign four copies, and hand them all to your current plan administrator. That administrator completes Section II, keeps one copy, and sends the funds along with the remaining three copies to the receiving institution, which completes Section III and mails one copy back to you.1Canada Revenue Agency. T2151 Direct Transfer of a Single Amount Under Subsection 147(19) or Section 147.3 Because the money moves directly between institutions and never passes through your hands, no tax is withheld and you don’t report the transferred amount as income.
Download the fillable PDF from the CRA website and open it in Adobe Acrobat Reader 10 or later. It will not work properly inside a web browser.
Before You Start
Form T2151 is for lump sums leaving an RPP or a DPSP. If your money is sitting in an RRSP, RRIF, SPP, or PRPP instead, that transfer runs on Form T2033, not this one.2Canada Revenue Agency. Transfer of Funds
Have this information in front of you:
- Your Social Insurance Number, full legal name, address, and phone number.
- The name and address of the transferring institution (the plan administrator or DPSP trustee currently holding the funds).
- The name, address, and plan or account number of the receiving institution.
- Written confirmation from the receiving institution that it will accept the incoming transfer. Some plans have restrictions or require parallel paperwork of their own.
Check that the plan you want the money to land in is actually eligible to receive it. For a DPSP transfer under subsection 147(19), the destination can be another RPP, an RRSP or RRIF where you are the annuitant, another DPSP (if it has at least five beneficiaries throughout the calendar year), or a licensed annuities provider for an advanced life deferred annuity.3Justice Laws Website. Income Tax Act 147 – Deferred Profit Sharing Plans For a money purchase RPP transfer under subsection 147.3(1), the eligible destinations are another money purchase RPP, an RRSP, a RRIF, or a licensed annuities provider for an ALDA.4Justice Laws Website. Income Tax Act 147.3 – Transfer – Money Purchase to Money Purchase, RRSP or RRIF Defined benefit RPP transfers have their own set of options depending on whether the receiving plan is defined benefit or money purchase; the transferring administrator will identify the correct subsection and confirm what’s allowed.
You should also know whether your pension is defined benefit or money purchase, because the tax-free amount differs. Money purchase plans transfer the full account balance. Defined benefit plans are capped at a maximum transfer value (MTV), with anything above the cap paid out to you as taxable income. If your DB lump sum is large, ask the plan administrator for the MTV calculation before you sign anything.
Print four copies of the form once you’re ready. Each of the three parties keeps one, and the fourth is yours.5Canada Revenue Agency. T2151 Direct Transfer of a Single Amount Under Subsection 147(19) or Section 147.3
Filling Out Section I
Section I is yours. Enter your SIN, full name, address, and phone number. Then identify the receiving plan: the type (RRSP, RRIF, RPP, DPSP, SPP, or PRPP), its plan registration number or account number, and the name and address of the institution that will hold it. Sign and date the form. Your signature is what authorizes the current plan administrator to release your funds.
Once all four copies are signed, hand the complete set to the transferor, meaning the DPSP trustee or RPP administrator that currently holds your money.
What the Transferor Does in Section II
The transferor completes Section II on all four copies. The administrator records the gross dollar amount being transferred and identifies the provision of the Income Tax Act that authorizes it: subsection 147(19) for a DPSP, or the applicable part of section 147.3 for an RPP.
If some portion of the amount doesn’t qualify for direct transfer, most commonly an excess over the maximum transfer value from a defined benefit plan, the transferor notes that separately. The non-qualifying portion is reported to you on a T4A slip as income for the year.6Canada Revenue Agency. T4A Slip – Information for Payers
The transferor keeps one copy, then forwards the other three copies along with the actual funds to the receiving institution.
What the Transferee Does in Section III
The receiving institution completes Section III, confirming the amount received and that the funds have been credited to a plan registered under the Income Tax Act. The transferee keeps one copy, returns one to the transferor, and mails the last one to you.
How the Four Copies Move
You never mail Form T2151 to the CRA yourself. The route is fixed:
- You complete and sign Section I on all four copies and deliver them to the transferor.
- The transferor completes Section II, keeps one copy, and sends three copies plus the funds to the transferee.
- The transferee completes Section III, keeps one copy, returns one to the transferor, and sends one to you.
Your copy is proof that the transfer was completed within a tax-sheltered framework. Keep it with your tax records. Because the money moved directly between plans, you do not report the transferred amount on your income tax and benefit return and you do not claim a deduction for it.7Canada Revenue Agency. Registered Pension Plan (RPP) Lump-Sum Payments
Some employer pension centres handle the paperwork differently. The federal Public Service Pension Centre, for example, asks members to mail the completed form directly to the centre and coordinates the rest of the transfer from there.8Canada.ca. Video: How to Complete – Canada Revenue Agency Direct Transfer Form (T2151) If your plan administrator gives you a specific submission process, follow that instead of the general flow.
When Part of the Amount Can’t Transfer Tax-Free
If a lump sum leaving a defined benefit RPP exceeds the maximum transfer value allowed under the Income Tax Act, the excess doesn’t stay tax-sheltered. The transferring institution reports the excess on your T4A slip in boxes 018 and 108, and you include it on line 13000 of your income tax and benefit return.7Canada Revenue Agency. Registered Pension Plan (RPP) Lump-Sum Payments
If the excess was still transferred into an RRSP, PRPP, SPP, or RRIF, the CRA treats it as an RRSP contribution for that year. You can deduct it on line 20800 up to your available RRSP deduction limit, and carry forward any amount beyond your limit to be deducted in future years as room opens up. Unused excess contributions left sitting in the plan can attract a penalty tax of 1% per month until they are withdrawn or absorbed by new contribution room, so watch the balance closely.
After the Transfer
Once your copy of the completed form arrives with Section III filled in, confirm that the dollar amount matches what you expected and check the account statement at the receiving institution to verify the funds landed in the correct plan type. If any portion was flagged as an excess and reported on a T4A slip, file that slip with your tax documents for the year.
Processing can take several weeks, particularly if the original plan needs to liquidate investments before sending cash. If you haven’t received confirmation within 60 days of submitting the form, follow up with both the transferor and the transferee to track the status.