RRIF (registered retirement income fund)

What a RRIF does

A RRIF is where RRSP savings usually go when it is time to take an income. You cannot normally contribute new money to one. It is funded by direct transfers from an RRSP, a pooled registered pension plan, a registered pension plan, another RRIF or an FHSA, and once it exists the carrier makes payments to you. You can hold more than one, and self-directed RRIFs follow rules generally similar to self-directed RRSPs.

Your RRSP does not last forever. December 31 of the year you turn 71 is the last day you can contribute, and by the end of that year you generally choose between moving the funds to a RRIF, buying an annuity, or withdrawing them. A direct transfer to a RRIF has no tax withheld.

The yearly minimum

Payments must start in the year after the year you set the RRIF up. The carrier calculates the minimum from your age at the beginning of each year, and you may choose to base it on your spouse’s or common-law partner’s age instead. That choice has to be made on the original application and cannot be changed later. You can always take more than the minimum, but never less.

Because the payout period is your lifetime, the minimum is a floor set by rules rather than a spending plan. Whether to take only the minimum or more is a planning decision about your other income.

How RRIF income is taxed

Payments are taxable in the year you receive them. The carrier reports them on a T4RIF slip, and they are generally entered on line 13000, or on line 11500 if you were 65 or older at the end of the year or are receiving them because a spouse or common-law partner died. At 65 or older, RRIF income also qualifies for the pension income amount.

Your RRIF income adds to CPP, OAS and any other income for the year, so it can affect your marginal rate and income-tested amounts. Ask your accountant how it fits with your whole picture.

An illustrative example

Suppose you turn 71 in 2026 and move $300,000 from your RRSP to a RRIF in November, with no tax withheld on the transfer. No payment is required for 2026. For 2027 your carrier calculates a minimum based on your age on January 1, 2027, and you receive at least that amount, reporting it as income. If the minimum comes to $16,000, that figure is added to your other 2027 income. The numbers are illustrative only and are not the real minimum factor.

What to discuss with your accountant

Ask when to convert, whether to base the minimum on a younger spouse’s age, how RRIF payments combine with other retirement income, and what happens to the fund at death. A spouse or other qualified beneficiary may be able to roll it over, otherwise the value is generally taxed on the final return. Bring your latest notice of assessment and carrier statements.