RRSPs and marriage breakdown

Zoomer | January 1st, 2006

Q – In a separation agreement, can the husband transfer some or all of his RRSP (or RRIF) to his wife so that it is only taxable in her hands when it is withdrawn? – J.C.


A – The answer to this and many similar questions can be found in Gordon Pape’s 2002 Buyer’s Guide to RRSPs. Here’s what the book says on marriage breakdown:


“If you’re separated or divorced and there’s a court order or a written separation agreement relating to property distribution, RRSP funds (as well as those from a registered pension plan or deferred profit‑sharing plan), may be transferred directly to a spouse’s RRSP or RRIF. You must be living apart at the time. In this case, a “spouse” may include someone you’ve lived with common law for at least a year or with whom you’ve had a child. The Canada Customs and Revenue Agency’s form T2220, Transfers between RRSPs or RRIFs on Marriage Breakdown, must be completed in these circumstances.” – G.P.