Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues: A RRIF annuitant gets married and the spouse is fourteen years younger than the RRIF annuitant, can the prescribed factor for the minimum amount be changed to the spouse's age?
Position: No.
Reasons: Existing RRIF cannot be amended to reflect spouse's age for purposes of prescribed factor; however, property can be transferred to a new RRIF which uses the spouse's age.
XXXXXXXXXX 2000-004420
M.P. Sarazin
September 7, 2000
Dear Sir\Madam:
Re: Amend the Prescribed Factor for a Registered Retirement Income Fund
This is in response to your letter of August 24, 2000, requesting confirmation that the prescribed factor used to compute the minimum amount for your registered retirement income fund ("RRIF") can only be amended by transferring the property in your existing RRIF to a new RRIF.
You have a RRIF that uses your age as the prescribed factor in computing the minimum amount that has to be paid out of your RRIF each year. You were married on August 31, 2000 and your wife is fourteen years younger than you. You were advised that the only way that your wife's age could be used as a prescribed factor for your RRIF is if you transfer the property (excluding an amount equal to the minimum amount under the fund that is required to be paid to you for the year in which the transfer is made) held in your RRIF to another RRIF under which you are the annuitant.
Opinions concerning proposed transactions involving specific taxpayers will only be provided in response to a request for an advance income tax ruling. For more information concerning advance tax rulings, please refer to Information Circular 70-6R3 dated December 30, 1996, issued by the Canada Customs and Revenue Agency (the "Agency"). Copies of information circulars and interpretation bulletins are available from your local tax services office or on the Internet at the following site - http://www.ccra-adrc.gc.ca/formspubs/menu-e.html. However, we can provide you with the following general comments.
The Agency's general views on transfers between registered plans are found in Interpretation Bulletin IT-528 titled "Transfers of Funds Between Registered Plans" (copy enclosed). You will note that paragraphs 8 and 9 deal specifically with transfers from a RRIF to another RRIF under which the same individual is the annuitant. There is nothing preventing an annuitant under a RRIF from establishing a new RRIF with the same or a different carrier where the annuitant's wife's age is used as the prescribed factor for determining the minimum amount under the new RRIF. Furthermore, the minimum amount may be retained in the old RRIF and paid out in the year of the transfer in accordance with the terms of the old RRIF.
We trust the above comments will be helpful.
Yours truly,
Patricia Spice
for Director
Financial Industries Division
Income Tax Rulings Directorate
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