13 October 1994 External T.I. 9421635 - RRIF AT DEATH

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:

Can proceeds of an RRIF receivable by a designated beneficiary be right or thing

Position TAKEN:

No

Reasons FOR POSITION TAKEN:

RRIF taxable for the last annuitant pursuant to 146.3(6) as 146.3(6.2) not applicable

		5-942163
XXXXXXXXXX		G. Martineau

Attention: XXXXXXXXXX

October 13, 1994

Dear Sirs:

Subject: Registered Retirement Income Fund ("RRIF")

This is in reply to your letter of August 16, 1994 in which you request a technical interpretation on the tax consequences on the death of the spouse of the RRIF last annuitant who died later the same day as the RRIF last annuitant. The spouse of the RRIF last annuitant was the designated beneficiary of the RRIF.

The Department does not provide opinions on a completed transaction. In such a case, the enquiry should be addressed to the relevant District Taxation Office. We offer, however, the following general comments.

On the death of an RRIF last annuitant, the fair market value of the RRIF property is brought into the deceased's income for the year of death pursuant to subsection 146.3(6) of the Act. Where amounts paid out of or under the RRIF are designated benefits of an individual as defined in subsection 146.3(1) of the Act, an amount determined pursuant to subsection 146.3(6.2) of the Act may be deducted from the amount deemed to have been received under subsection 146.3(6) of the Act.

In order to be designated benefits of a spouse, amounts paid out or under an RRIF must, among others, either be paid to the spouse or paid to the last annuitant's legal representative and designated jointly by the legal representative and the spouse.

As you can realize, it is unlikely that this definition can be met in a situation where the last annuitant of an RRIF and her spouse died the same day.

Under the above described circumstances, our view is that any amount receivable by the spouse before his death as designated beneficiary of an RRIF does not constitute a right or thing within the meaning of subsection 70(2) of the Act.

The above comments reflect an expression of opinion only and are not binding on the Department, as explained in paragraph 21 of Information Circular 70-6R2. We trust, however, that they are of assistance.

Yours truly,

for Director
Financial Industries Division
Rulings Directorate
Policy and Legislation Branch