Taxation of RRSP/RRIF on death

The balance in an RRSP or a RRIF is fully taxable to the Canadian taxpayer on death. Some income tax planning is possible for an RRSP by designating a spouse as the RRSP beneficiary in the RRSP account, not a will effectively rolling the RRPS to the spouse. In the case where the spouse is designated as the beneficiary the proceeds paid to the spouse constitute a refund of RRSP premiums and can be fully transferred into the spouse’s RRSP. For a RRIF a spouse can be designated as a secondary annuitant and upon death the regular payments will be received by and taxable to the surviving spouse.