RRIF Guide Canada: Conversion Rules 2025

How to convert your RRSP to a RRIF, minimum withdrawal rates by age, and strategies to minimize taxes on mandatory income.

What Is a RRIF?

A Registered Retirement Income Fund (RRIF) is the primary vehicle for converting your RRSP into a retirement income stream. Once you establish a RRIF, you must withdraw a minimum amount each year — these withdrawals are taxable income. The RRIF allows your remaining balance to continue growing tax-deferred.

You must convert your RRSP to a RRIF (or purchase an annuity) by December 31 of the year you turn 71. There is no maximum withdrawal — you can take out as much as you want, up to the entire balance.

RRIF Minimum Withdrawal Rates by Age

Age	Minimum Withdrawal Rate
65	4.00%
66	4.17%
67	4.35%
68	4.55%
69	4.76%
70	5.00%
71	5.28%
72	5.40%
75	6.82%
80	8.75%
85	10.33%
90	13.62%
95+	20.00%

The percentage is applied to the January 1 market value of your RRIF each year. As you age, the required withdrawal percentage increases, which means larger taxable withdrawals and potential OAS clawback risk.

Converting Early: The RRIF Meltdown Advantage

You can convert your RRSP to a RRIF at any age — not just at 71. Converting early (e.g., at 65 or even 60) allows you to begin drawing down your RRSP/RRIF at lower tax rates during years when your income may be lower than it will be at 71. This "meltdown" strategy is particularly effective when combined with topping up a TFSA with the after-tax proceeds.

Using a Younger Spouse to Lower Minimum Withdrawals

Federal rules allow you to base your RRIF minimum withdrawal on your younger spouse's or common-law partner's age rather than your own. Since the withdrawal percentage is lower for younger ages, this reduces the mandatory income from your RRIF, helping manage taxes and OAS clawback.

RRIF Withholding Tax

When you withdraw from a RRIF, your financial institution withholds tax at these rates (for amounts above the annual minimum):

• Up to $5,000: 10%
• $5,001 to $15,000: 20%
• Over $15,000: 30%

The minimum required withdrawal has no withholding tax, but it is still fully taxable when you file your return. Plan accordingly so you don't face a large tax bill in April.

RRIF and Pension Income Credit

RRIF withdrawals made after age 65 qualify as "pension income" for the federal pension income credit ($2,000 credit at the lowest marginal rate). This is a modest but real tax benefit. It also enables pension income splitting with a spouse — you can allocate up to 50% of RRIF income to your spouse's tax return.

What Happens to a RRIF at Death?

On death, the RRIF balance can be transferred tax-free to a surviving spouse's RRSP or RRIF. If there is no surviving spouse, the full balance is included in the deceased's final income tax return, which can trigger significant taxes. Proper estate planning — including beneficiary designations — is essential.