Principal Issues: [TaxInterpretations translation] Can an RRSP that is a spousal or common-law partner plan be transferred to a RRIF that is not a spousal or common-law partner RRIF?
Position: The RRIF may receive amounts from a spousal or common-law partner RRSP, but because of this transfer, the RRIF will be a spousal or common-law partner RRIF.
Reasons: Definition of "spousal or common-law partner plan” in subsection 146(1).
2009-034006
XXXXXXXXXX Catherine Ayotte,
Notary, M.Fisc.
September 30, 2009
Dear Sir,
Subject: Transfer from a spousal or common-law partner RRSP to a RRIF
This is further to your e-mail of September 10, 2009, in which you asked our opinion on the above subject. In particular, you wish to know if a spousal or common-law partner registered retirement savings plan (RRSP) can be transferred to a registered retirement income fund (RRIF) that is not a spousal or common-law partner RRIF.
Please note that unless otherwise indicated, all legislative references herein are to the provisions of the Income Tax Act (the "Act").
It appears to us that the situation described in your letter may constitute an actual situation involving taxpayers. As explained in Information Circular 70-6R5, it is not the practice of the Directorate to comment on proposed transactions involving specific taxpayers otherwise than in the form of an advance income tax ruling. If your situation involves a specific taxpayer and a completed transaction, you should provide all relevant facts and documentation to the appropriate Tax Services Office for its views. However, we are prepared to provide the following general comments.
Paragraph 146(16)(a) allows property accumulated in an unmatured RRSP to be transferred tax-free to a RRIF if the annuitant of both plans is the same individual.
By virtue of subsection 146(1), a spousal or common-law partner plan in respect of a taxpayer includes:
(a) an RRSP to which the taxpayer has, at a time when the taxpayer’s spouse or common-law partner was the annuitant under the plan, paid a premium, or
(b) an RRSP that has received a payment out of or a transfer from an RRSP or a RRIF that was a spousal or common-law partner plan in relation to the taxpayer, or
(c) a RRIF that has received a payment out of or a transfer from a spousal or common-law partner plan in relation to the taxpayer
If a RRIF receives amounts from a spousal or common-law partner RRSP, then that plan is also a spousal or common-law partner plan. This characterization is relevant, inter alia, for the purposes of subsections 146(8.3) and 146.3(5.1).
We hope that our comments are of assistance.
Best regards,
Ghislain Martineau
Manager
Financial Sector and Exempt Entities Section
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch.