If your spouse passes away his or her assets will need to be distributed to you and any other beneficiaries. Different rules apply to different types of assets.
Registered Retirement Savings Plans (RRSP)
If your spouse held an RRSP you can:
- transfer the funds to another RRSP
- transfer the funds to an RRIF
- transfer the funds to a registered annuity with an insurance company
If your spouse had an Annuity when he/she died that was a term annuity and you were named as the Successor Annuitant you will begin to receive the remaining payments. If it was a life annuity and not a term, then payments will stop at death.
Registered Retirement Income Funds (RRIF)
If your spouse had money in an RRIF, the value of the remaining amount in the RRIF can be paid to you as a Designated Benefit. The funds can be received tax sheltered by either:
- Transferring the funds to another tax-sheltered plan such as an RRIF or an RRSP (if you are 71 or younger)
- Taking over the RRIF assets. You will then start receiving the payments and be responsible for paying tax on the yearly withdrawals
- Using the funds to purchase an annuity
Deferred Profit Sharing Plan (DPSP)
As with other registered plans, if your spouse had a DPSP when he/she died the proceeds of the plan can be transferred on a tax free basis into one of the following in your name:
- Registered Pension Plan (if the plan permits)
If your spouse held Non-Registered assets at death there will probably be opportunities to transfer or ‘rollover’ those assets to you without immediate tax implications. Under the spousal rollover rules all assets can be transferred to you without immediate tax consequences.
If your property is registered in joint tenancy With Right of Survivorship (WROS) , meaning both spouses are equal owners, on the death of your spouse, you automatically assume full ownership of the property. This will reduce Probate fees.
Your financial advisor can provide you with more information about the implications of transferring your spouse’s assets.
Here are some experts who can help.
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