RRSP to RRIF at 71: Canada Guide

At a glance

Turning 71? Understand the RRSP conversion deadline, RRIF versus annuity, taxable cash-outs, spouse RRSP contributions and first minimum withdrawals.

Your RRSP cannot remain an ordinary unmatured RRSP forever. The year you turn 71 has a legal deadline, but converting everything to cash is not the only option.

Quick answer: RRSP convert to RRIF at 71

By December 31 of the year you turn 71, an RRSP generally must mature: it can be transferred to a RRIF, used to buy a qualifying annuity or paid out as taxable income. RRIF minimum payments usually begin the following year.

What actually changes in the year you turn 71?

You generally can make your own RRSP contributions up to December 31 of that year, subject to room, and the RRSP must mature by year-end. Do not wait until December 31 to give the financial institution instructions. Administrative processing, holdings and paperwork need lead time.

How does a RRIF work?

A RRIF holds eligible registered retirement assets and requires annual minimum withdrawals from the year after it is established. Investment growth can remain sheltered within the RRIF, but payments from the RRIF are generally taxable when received. There is no mandatory maximum withdrawal under the ordinary RRIF rules.

Is a qualifying annuity another option?

Yes. An annuity can provide a stream of payments under its contract terms. Compare inflation, survivor benefits, guarantees, liquidity and fees; choices can be difficult to reverse. An annuity is not automatically more tax-efficient than a RRIF.

What if you simply withdraw all RRSP money?

The full taxable amount may be included in income in one year, potentially creating a high marginal tax bill and reducing income-tested benefits. Withholding at the time of withdrawal is only an advance payment, not necessarily the final tax.

Can you contribute to a younger spouse’s RRSP after your own age 71?

Potentially yes, if you have eligible RRSP deduction room and the spouse’s age permits a contribution to their RRSP. Your own RRSP age cutoff does not automatically eliminate the possibility of deducting contributions to a younger spouse’s plan. Spousal attribution rules still matter later.

Can you select a younger spouse’s age for RRIF minimums?

At RRIF establishment, the RRIF annuitant may be able to elect to base minimum withdrawal calculations on their younger spouse’s or common-law partner’s age. This can reduce required annual minimum payments. The timing and permanence of the choice need attention.

How are RRIF withdrawals, withholding and taxes handled?

Minimum payments generally have different withholding treatment from amounts withdrawn beyond the minimum, while both are typically taxable income. Age, eligible pension-income credits and possible pension splitting may affect the household calculation.

What about HBP, LLP and death?

Unpaid HBP or LLP balances near age 71 have special consequences. On death, registered-plan proceeds may be taxable or eligible for certain rollovers depending on the beneficiary and legal requirements. Review beneficiary designations and estate planning separately.

A worked example: RRSP convert to RRIF at 71

An Ontario resident turns 71 in June 2027 with $300,000 in RRSPs. They arrange a direct RRSP-to-RRIF transfer before December 31, 2027. They normally do not need a RRIF minimum distribution in 2027 if the RRIF is first established that year, but minimum annual payments start in 2028.

Quick-reference decisions: RRSP convert to RRIF at 71

Your situation	What it usually means	What to check next
Transfer RRSP to RRIF	Usually no immediate income inclusion on qualifying direct transfer	Minimum RRIF payments normally start following year.
Buy qualifying annuity	Creates contracted payment stream	Review survivor, guarantee and inflation terms.
Cash out the RRSP	Generally taxable in year of withdrawal	Model tax and benefits impact before choosing.

Four special situations: RRSP convert to RRIF at 71

You still have RRSP room but are over 71 — Your own RRSP may be closed, yet a younger spouse’s RRSP contribution might remain available.
You choose a younger spouse’s age — The minimum RRIF payment election should be considered at RRIF establishment.
You consider cashing out everything — One-year income can create bracket and OAS recovery effects.
You hold a locked-in retirement account — LIRA/LIF or other pension rules may differ from ordinary RRSP and RRIF rules.

What to do, step by step: RRSP convert to RRIF at 71

List all RRSP accounts and exact turning-71 calendar year.
Compare RRIF, qualifying annuity and cash-out outcomes.
Review spouse age election and beneficiaries.
Arrange direct maturity transaction before December 31.
Plan next-year withdrawals and tax withholding.

Common mistakes to avoid: RRSP convert to RRIF at 71

Waiting until December 31 to start bank paperwork
Confusing zero first-year minimum with zero taxable voluntary withdrawal
Assuming RRIF transfer is mandatory liquidation to cash

Frequently asked questions: RRSP convert to RRIF at 71

These answers describe the ordinary rule. Special facts, the filing year and CRA reviews can change the outcome.

Must I sell all my investments to open a RRIF?

Not always. A qualifying in-kind direct transfer may be possible depending on the financial institution and holdings.

Can I leave an RRSP past age 71?

An ordinary RRSP generally must mature by the end of the year you turn 71.

Can I withdraw more than RRIF minimum?

Generally yes, but higher withdrawals may have withholding and tax consequences.

Official CRA sources: RRSP convert to RRIF at 71

Need help with RRSP convert to RRIF at 71?

Presyz is a Toronto accounting and taxation firm. Rules depend on the tax year, family circumstances, documentary evidence and applicable federal and Ontario law. This educational guide is not a substitute for reviewing your specific situation. Contact Presyz through this website if you want help with a filing or planning decision.

General educational content only. Verify current CRA and provincial guidance before acting.

Turning 71 in Canada: RRSP to RRIF Conversion, Annuities and Tax Choices