Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues:
Are transfers of property from RRSPs to RRIFs at their fair market value?
Position: Yes.
Reasons:
Subsection 206(4) is clear. We have brought problem to the attention of the Department of Finance.
XXXXXXXXXX 990363
M. P. Sarazin
Attention: XXXXXXXXXX
February 15, 1999
Dear Sirs:
Re: Cost Amount of Property Transferred from an RRSP to a RRIF
This is in reply to your facsimile dated February 11, 1999, wherein you requested confirmation of our position regarding the cost amount, for purposes of Part XI of the Income Tax Act (the “Act”), of property transferred from a registered retirement savings plan (“RRSP”) to a registered retirement income fund (“RRIF”) for the same annuitant.
We have recently completed a review of the application of Part XI to the above noted transfers. Since it is clear that the provisions of subsection 206(4) of the Act would apply to transfers between an RRSP and a RRIF, the property received by the RRIF would have a cost amount equal to the fair market value of the property on the transfer date. The issue of whether transfers between RRSPs and RRIFs with the same annuitant should be at cost or fair market value for purposes of Part XI has been brought to the attention of the Department of Finance.
We also note that transfers between one individual’s RRIFs must occur at fair market value because of the requirements of paragraphs 146.3(2)(e) and (e.1) of the Act.
We trust that our comments will be of assistance.
Yours truly,
Paul Lynch
for Director
Financial Industries Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 1999
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 1999
Email this Content