The Globe and Mail published “A guide to naming a beneficiary of your TFSA, RRSP or RRIF” that can be found here. In this helpful guide, a lot of information was provided about naming beneficiaries and successor holders or successor annuitants of TFSAs, RRSPs and RRIFs, which I’ve summarized below.

Making these designations is an important part of the estate planning process and is often done directly with a financial institution. However, if it makes sense for our clients and their estate plans, we in the Wills, Estates, Trusts and Charities Law Group explore the option of making a declaration in our clients’ Wills with respect to their beneficiary designations. Excerpts of the clauses in which these declarations are made are then sent to the financial institutions and/or life insurance companies holding our clients’ registered plans and/or life insurance policies, so that they may update their files accordingly.

Importantly, when a declaration is made within a Will, naming a beneficiary other than the estate, the proceeds from the registered plan(s) or life insurance policy (or policies) are not added to the value of the estate when estate administration taxes (formerly “probate fees”) are calculated after death. This results in a win-win: on death, the proceeds of registered plans and life insurance policies can be distributed in accordance with a client’s Will, preventing beneficiaries (ie. minor, disabled, etc.) from inheriting large sums of money outright, and estate administration taxes will not be payable on such proceeds.

We understand that this aspect and many other aspects of the estate planning process can be daunting and confusing. We therefore encourage you to speak to us about your estate plan and the options available to you. We are here to help.

As mentioned above, here is a summary of the information from the Globe and Mail’s article:


  • Anybody can be named as a “beneficiary” and that person will take the cash tax-free
  • If your beneficiary wants to put it in a TFSA or RRSP, there must be contribution room, unless the beneficiary is your spouse in which case the money can be deposited into their TFSA, regardless of the contribution room available (but your spouse must ensure there is room for growth)
  • The growth in the TFSA account between the date of death and the date of payout to the beneficiary is taxable in the hands of the beneficiary
  • If your spouse is named as a “successor holder” and not a “beneficiary”, the value of the account on the date of death will be transferred to him or her on a tax-free basis, the growth after death remains tax-free and the value of the account can be invested in your spouse’s TFSA with no concern about whether there is contribution room


  • Anyone can be named as a beneficiary, and if no one is named, your estate is the beneficiary
  • The value of the account on your date of death will be taxable on your final tax return and paid out of your estate, unless your spouse is named as beneficiary, in which case the plan can be rolled over on a tax-deferred basis (taxes are deferred until your spouse removes money from the plan)
  • If the RRSP is taken in cash by your spouse, the proceeds can be taxed in your hands or your surviving spouse’s for the year of death


  • You have the choice of naming your spouse as a “beneficiary” or “successor annuitant”
  • Naming a beneficiary works similarly to an RRSP in terms of the tax rollover being an option and your estate or beneficiary otherwise paying tax on cash proceeds for the year of death
  • Naming a beneficiary collapses the RRIF, whereas, naming your spouse as a successor annuitant allows your spouse to take over your RRIF, which might be a good option if your surviving spouse is older than you, as the mandatory withdrawal schedule for the RRIF would be set at the age originally chosen by you.