RRSP to RRIF at 71 — What Happens and How to Prepare
What you will learn: What the mandatory RRSP conversion at 71 means, how RRIF minimum withdrawals work, how they affect your taxes and benefits, and the strategies worth knowing before you turn 71.
By December 31 of the year you turn 71, your RRSP must be closed. If you do not act before that date, CRA will automatically include the entire RRSP balance as income on your tax return — potentially creating a tax bill of tens of thousands of dollars in a single year. Most Canadians convert their RRSP to a RRIF before this deadline. Converting to a RRIF is not something you do at the bank teller window — contact your financial institution well before December to give them time to process it.
Walter, 70, from Guelph, Ontario. Walter had always been careful with money. He had an RRSP worth $87,000 — modest savings from 35 years of part-time work and steady contributions. He assumed the money would just "stay there" until he needed it.
On January 15 of the year he turned 72, Walter opened a letter from CRA. It was a tax assessment showing $87,000 in income for the previous tax year — his entire RRSP had been collapsed because he missed the December 31 RRIF conversion deadline. His total tax owing: over $18,000.
"I had no idea there was a deadline," Walter said. "I thought it would just sit there forever. My bank never called me."
Walter's story is not unusual. The RRSP-to-RRIF deadline is one of the least-understood rules in the Canadian tax system — and one of the most expensive to miss.
What Is a RRIF and How Does It Work?
A Registered Retirement Income Fund (RRIF) is the account your RRSP becomes when you convert it. Your investments stay in the same mutual funds, GICs, or bonds they were in before — they simply move to a RRIF wrapper. The money continues to grow tax-deferred inside the RRIF.
The difference from an RRSP: each year, you must withdraw a minimum amount from your RRIF based on your age. This minimum increases as you get older. All RRIF withdrawals are added to your income for the year and taxed at your marginal tax rate — just like employment or pension income.
The RRIF Minimum Withdrawal Table
The minimum withdrawal percentage is set by the federal government. Here are the rates for selected ages (2026):
| Age at start of year | Minimum % of RRIF value | Example on $87,000 RRIF |
|---|---|---|
| 71 | 5.28% | $4,594/year |
| 72 | 5.40% | $4,698/year |
| 75 | 5.82% | $5,063/year |
| 80 | 6.82% | $5,933/year |
| 85 | 8.51% | $7,404/year |
| 90+ | 11.92%+ | $10,370/year+ |
The minimum percentage applies to the RRIF balance on January 1 of each year. You can always withdraw more than the minimum — but never less. For the current year's complete table, see CRA's RRIF minimum amounts.
How RRIF Withdrawals Affect Your Benefits
RRIF withdrawals count as income for every income-tested government benefit — including GIS, the OAS Recovery Tax (clawback), Ontario Trillium Benefit, and Ontario Drug Benefit co-payments. A senior who qualifies for GIS one year may lose it entirely the next if a large RRIF withdrawal or inheritance pushes their income above the threshold. Planning when and how much to withdraw can significantly reduce this impact.
Three benefit interactions to watch:
Three Strategies Worth Knowing
Strategy 1: Use your younger spouse's age for lower minimums
Strategy 2: Convert earlier than 71 if it makes sense
Strategy 3: Consider a Life Income Fund (LIF) for workplace pension savings
What to Do Before December 31 of Your 71st Year
Steps to take in the year you turn 71:
The RRSP-to-RRIF conversion is mandatory — but how you manage it is not. The decisions you make at 71 affect your tax situation and your government benefits for the rest of your life.
The most important action: contact your bank or financial institution in the fall of the year you turn 71. Do not wait until December. The paperwork takes time.
Quick Answers
You have until December 31 of the year you turn 71 to convert — not age 70. If you turned 71 this calendar year, you need to act before December 31 of this year. Contact your bank or financial institution in October or November to give them enough time to complete the paperwork. If you already turned 71 last year and did not convert, call your financial institution and CRA immediately at 1-800-959-8281 — they may be able to help minimise the damage.
Yes. The minimum is a floor, not a ceiling. You can withdraw any amount above the minimum at any time. However, additional withdrawals beyond the minimum are subject to withholding tax at the time of withdrawal (10% for amounts over $5,000 up to $15,000; 30% for amounts over $15,000). The withholding tax is not a final tax — it is a prepayment credited when you file your return. Taking extra withdrawals in low-income years (before CPP or OAS starts) is a common strategy to reduce the RRIF balance before mandatory minimums become very large.
If your spouse or common-law partner is named as the beneficiary, the RRIF can be transferred to their RRSP or RRIF without immediate taxation — this is called a rollover. If your children or estate are named as beneficiaries, the remaining RRIF balance is included as income on your final tax return and taxed accordingly. Naming your spouse as beneficiary is usually the most tax-efficient option for couples. Review your RRIF beneficiary designation with your financial institution.
A RRSP maturity notice is the bank's way of telling you that your RRSP must be converted by December 31 of the year you turn 71. It is not automatic — you must contact your bank to complete the conversion. Do not ignore this notice. Call your bank when you receive it and ask them to walk you through the RRIF conversion process, including the option to use your younger spouse's age for minimum calculations.