RPP and DPSP Lump-sum payments

RPP payments

You can contribute to your RRIF by directly transferring a lump-sum payment from:

• an RPP under which you are a member, if you are entitled to receive the lump-sum;
• an RPP under which your current or former spouse or common-law partner was the member, if you are entitled to receive the lump-sum because your current or former spouse or common-law partner died; or
• an RPP under which your current or former spouse or common-law partner is a member, if you are entitled to receive the lump-sum under the following conditions:
  • under a decree, order or judgment of a court, or under a written separation agreement; and
  • to settle rights arising out of your relationship on or after the breakdown of your relationship.

Note
In some cases, the Income Tax Act limits how much can be transferred in a RRIF without tax consequences. For more information, see Excess amounts from a RRIF.

DPSP payments

Under proposed changes, you will be able to contribute to your RRIF by directly transferring a lump-sum payment from:

• a DPSP under which you are a member, or former member, if you are entitled to receive the lump-sum;
• a DPSP under which your current or former spouse or common-law partner was the member, or former member, if you are entitled to receive the lump-sum because your current or former spouse or common-law partner died; or
• a DPSP under which your current or former spouse or common-law partner is a member, or former member, if you are entitled to receive the lump-sum:
  • under a decree, order or judgment of a court, or under a written separation agreement; and
  • to settle rights arising out of your relationship on or after the breakdown of your relationship.

Note
Contributions made by you to your DPSP may not be transferable to your RRIF. For exceptions to the direct transfer requirement and other rules, see Interpretation Bulletin IT-528, Transfers of funds Between Registered Plans.

Completing your tax return

If you transferred the amount directly, do not claim a deduction for the amount transferred and no not include the payment in income.

However, if you received the lump-sum payment in cash or by cheque before making the transfer, the transfer is not tax-free. Report the payment on line 130 of your return on the year the payment is received.

Forms and publications

• Guide T4040, RRSPs and Other Registered Plans for Retirement
• Interpretation Bulletin IT-528, Transfer of Funds Between Registered Plans