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Withdrawals from an RRIF

One of the features unique to Registered Retirement Income Fund (RRIF) accounts is the mandatory annual withdrawal stipulated in the Canada Revenue Agency (CRA) rules that govern RRIFs.

Each year the RRIF account’s Annuitant must withdraw a set minimum amount from their account. For those annuitants 71 years and younger, the annual minimum payment is calculated based upon the following formula:

 

 

 

For those annuitants that are 72 years of age and older, the CRA sets the minimum annual amount you must withdraw from your RRIF according to a preset schedule. The Minimum Annual Withdrawal Amount is calculated based upon your age and the market value of your RRIF account assets on January 1 each year. See the chart below for the annual minimum percentages.

Important Notice: In its 2015 budget, the federal government announced changes to the Minimum Annual Withdrawal Amounts for those that are 71 years of age and older. The new RRIF withdrawal rates will apply for the 2015 and subsequent taxation years. To provide flexibility, the budget document states RRIF holders who withdraw more than the reduced 2015 minimum amount in 2015 will be permitted to re-contribute the excess to their RRIFs until Feb. 29, 2016. 

The chart below displays the minimum withdrawal rates for the pre-2015 years, 2015 and subsequent taxation years. (Note: The new withdrawal rates are taken from the federal government's 2015 budget paper.)

 

Age at

Start of

the Year

Pre-2015

Minimum

Withdrawal

 

New

Minimum

Withdrawal

Age at

Start of

the Year

Pre-2015

Minimum

Withdrawal

 

New

Minimum

Withdrawal

4.00%4.00%8.75%

6.82%

4.17%4.17%8.99%7.08%
4.35%4.35%9.27%7.38%
4.55%4.55%9.58%7.71%
4.76%4.76%9.93%8.08%
5.00%5.00%10.33%8.51%
7.38%5.28% 10.79%8.99%
7.48%5.40%11.33%9.55%
7.59%5.53%11.96%10.21%
7.71%5.67%12.71%10.99%
7.85%5.82% 13.62%11.92%
7.99%5.98% 14.73%13.06%
8.15%6.17%16.12%14.49% 
8.33%6.36%17.92%16.34%
8.53%6.58% 20.00%18.79% 
   20.00%20.00%

 

Example: Let's say your RRIF assets had a market value of $100,000 and you were 77 years of age on January 1. Your Minimum Annual Withdrawal Amount would be calculated as;

  
        Annual Minimum RRIF Withdrawal =$100,000  X  8.15%  =  $8,150.00

 

Note: You will typically have a number of payment options available when taking the Annual Minimum RRIF Withdrawal Amount out of your RRIF account(s). Your financial institution will typically provide you with various options - one-time lump-sum, monthly, quarterly payments. 

For more information with regard to withdrawals from an RRIF see the FAQ section.

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