15 May 2002 External T.I. 2002-0132725 - COMBINE RRIF AND SPOUSAL RRIF

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 CCRA.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ADRC.

Principal Issues:

Can a taxpayer combine his or her regular RRIF with his or her spousal or common-law partner RRIF?

Position: Yes.

Reasons:

The Act provides for the transfer of property between plans with the same annuitant but the combined plan becomes a spousal or common-law partner plan.

XXXXXXXXXX 2002-013272
M. P. Sarazin, CA
May 15, 2002

Dear XXXXXXXXXX:

Re: Combine Spousal RRIF with a Regular RRIF

This is in reply to your letter of March 21, 2002, requesting approval for the combining of your spousal or common-law partner registered retirement income fund ("RRIF") with a regular RRIF to form a single RRIF. The purpose of combining the plans is to reduce fees, increase rates of return and to have the minimum payment made from a single RRIF.

Comments

A "spousal or common-law partner plan" is defined in subsection 146(1) of the Income Tax Act (the "Act") to include any RRSP or RRIF that has received property as a result of a transfer from a spousal or common-law partner plan. Consequently, any transfer of property from a spousal or common-law partner plan to a non-spousal or common-law partner plan will result in the transferee plan becoming a spousal or common-law partner plan for purposes of the Act. Although the attribution rules for RRIFs in subsection 146.3(5.1) of the Act would no longer apply where there has not been a contribution by the annuitant's spouse since the 1980s, there is no provision in the Act that allows for the spousal or common-law partner plan to become a non-spousal or non-common-law partner plan.

You do not need the approval of the Canada Customs and Revenue Agency to transfer between RRIFs. Your RRIF carrier can provide you with a form T2033 which is used to record a direct transfer between plans under paragraph 146.3(2)(e) of the Act. The form T2033 requires the disclosure of whether the property transferred is from a spousal or common-law partner plan. The fact that the transferee plan will become a spousal or common-law partner plan is inconsequential because the attribution rules would not apply to your plan.

We trust that the above comments will be of assistance to you.

Yours truly,

Roberta Albert, CA
for Director
Financial Industries Division
Income Tax Rulings Directorate