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Merging a Spousal RRSP and an individual RRSP



I had an interesting question last week about combining the money in a spousal RRSP with the spouse's personal RRSP. My first reaction was that this could not be done for tax reasons. To my surprise, it can be done.

Then I thought, why would someone wish to do this? Well, apart from simplifying reporting, combining accounts may reduce fees. In particular, the combined account may be large enough to qualify for high-net-worth pricing.

There is one big caution about doing this. Recall that any withdrawal from a spousal RRSP within three years of the last deposit, will be attributed back to the spouse that made the contribution. That means the spouse will have to pay any taxes owing on the withdrawal.

When a spousal RRSP is combined with the spouse's RRSP, the entire new merged contract is subject to the 3 year attribution rules. So plan carefully.

If you have any questions, please let give me a call.

Thank you for all your support.

Scott Edgington

Director of Wealth

Qualified Financial Services

416 786 4140


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