Prescribed Registered Retirement Income Fund

What is a prescribed RRIF?

A prescribed RRIF is a retirement option that operates similar to a RRSP except that it provides the owner with an annual income.  A prescribed RRIF provides retirees with flexibility in determining how much income is withdrawn annually and how the money is invested.  Investment earnings continue to grow on a tax-sheltered basis.

When can I start a prescribed RRIF?

You must be eligible to commence your pension to transfer locked-in pension money to a prescribed RRIF.

If you are transferring money directly from a pension plan, the earliest age at which your pension can commence is established by the rules of the plan. You may transfer money from a LIRA at the earlier of age 55 or the early retirement age established by the plan where the money originated.

Does my spouse have to sign a consent form for me to transfer to a prescribed RRIF?

Yes. Under pension legislation, your spouse is entitled to receive a guaranteed pension on your death paying 60% of the pension amount to which you were entitled. A prescribed RRIF cannot provide that guarantee to your spouse. As well, there is nothing preventing you from withdrawing the entire amount from your prescribed RRIF in which case your spouse would not receive any pension on your death.

What is the minimum withdrawal required to be made from a RRIF?

A RRIF must be registered under the Income Tax Act. One of the most important rules found in the Income Tax Act for a RRIF is that you must be paid an income each year, except for the first year of the contract. The Income Tax Act establishes the minimum annual withdrawal required to be made from a RRIF. You do not have to withdraw money in the calendar year in which the RRIF is established.

A RRIF operates on a calendar year basis. The amount of the minimum withdrawal varies each year based on your age at January 1.

Can I use my spouse’s age in determining the minimum withdrawal?

Yes. The Income Tax Act permits you to use your age or the age of your spouse in determining the minimum withdrawal. This is a one-time decision made with the prescribed RRIF is established. Using the age of the younger person will reduce the minimum required withdrawal.

To determine the minimum annual payment, multiply the value of your prescribed RRIF as at January 1 by the rate that corresponds to your age:

Age at January 1	Rate (%)	Age at January 1	Rate (%)
50	2.50	73	7.59
51	2.56	74	7.71
52	2.63	75	7.85
53	2.70	76	7.99
54	2.78	77	8.15
55	2.86	78	8.33
56	2.94	79	8.53
57	3.03	80	8.75
58	3.13	81	8.99
59	3.23	82	9.27
60	3.33	83	9.58
61	3.45	84	9.93
62	3.57	85	10.33
63	3.70	86	10.79
64	3.85	87	11.33
65	4.00	88	11.96
66	4.17	89	12.71
67	4.35	90	13.62
68	4.55	91	14.73
69	4.76	92	16.12
70	5.00	93	17.92
71	7.38	94 and beyond	20.00
72	7.48

What is the maximum withdrawal from a prescribed RRIF?

There is no maximum limit on RRIF withdrawals.

Will I be taxed on the withdrawals?

The withdrawal will be considered part of your income for the year and you will have to pay tax. There is no withholding tax on the minimum withdrawal. Tax is required to be withheld on withdrawals that exceed the minimum.

What are the rules for investing my prescribed RRIF?

The investment rules are those placed on a RRIF by the Income Tax Act. No further restrictions apply. You determine how the money in your prescribed RRIF is invested and investment earnings continue to grow on a tax-sheltered basis to the extent they are not withdrawn.

What happens when I die?

You must name your spouse as beneficiary of the money in your prescribed RRIF. However, your spouse may waive his or her designated beneficiary status by signing a waiver form and filing it with the financial institution that administers your prescribed RRIF before your date of date. Your spouse may revoke the waiver at any time before your date of death by providing notice in writing to the issuer of the prescribed RRIF. Form 2, Spouse’s Waiver of Designated Beneficiary Status, can be found in Appendix A.

If you have no spouse or if your spouse has signed a waiver, the money will pass to a designated beneficiary or your estate and will be taxed in the year of your death as determined by your executor.

The disposition of the money is governed by the Income Tax Act.

Where can I find a prescribed RRIF?

A wide variety of financial institutions, such as banks, trust companies, credit unions, insurance companies and brokerage firms, offer the product.

Can my prescribed RRIF be seized by my creditors?

No. The money in a prescribed RRIF is exempt from execution, seizure or attachment. Also, you may not assign the money.

However, a prescribed RRIF could be subject to a division on spousal relationship breakdown pursuant to The Family Property Act. As well, the money in a prescribed RRIF could be subject to attachment for purposes of enforcing a maintenance order pursuant to The Enforcement of Maintenance Orders Act.

Do I ever have to purchase a life annuity?

No. You do not have to purchase a life annuity.

Is my prescribed RRIF guaranteed or protected from loss?

Your prescribed RRIF is not insured or guaranteed by the Government of Saskatchewan. Your pension income could suffer from poor investment performance.

Some of the products in which you are invested might be guaranteed. For example, deposits at banks, trust companies and credit unions are backed by insurance schemes.

I’m comfortable with my LIRA investments, but want to start a prescribed RRIF. How can I keep my investments?

Subject to the provisions of your prescribed RRIF contract, you may be able to transfer identifiable and transferable securities, either into or out of a prescribed RRIF. This would permit you to continue a particular investment strategy you have adopted in investing your LIRA assets without having to dispose of and repurchase the securities.

Can I transfer my money from one prescribed RRIF to another prescribed RRIF?

Yes. However, before the transfer takes place, the minimum annual withdrawal amount required under the Income Tax Act must be taken.

Can I roll over my annual withdrawal to an RRSP or RRIF?

No. The prescribed RRIF has certain characteristics such as protection of spouses that make it different from an ordinary RRSP or RRIF.

Can I transfer assets to my Prescribed RRIF from an ordinary RRSP or RRIF?

Pension legislation now permits, but does not require, a prescribed RRIF contract to accept assets that are not locked-in.  This would allow you to transfer assets held in an ordinary RRSP or RRIF to your prescribed RRIF.  However, once non-locked-in assets are transferred to a prescribed RRIF they are subject to the plan rules governing the contract and applicable legislation.

Do I receive my income monthly or in a lump sum at the start of the year?

The frequency of payments is a matter between you and your financial institution.

Are prescribed RRIF payments eligible for the pension tax credit?

Payments from a RRIF to a person age 65 and older are eligible for the pension tax credit. However, if you are under age 65, you will not be able to claim your RRIF payments.

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