Are RRSPs considered to be marital assets?
Provincial laws differ when it comes to the division of property in a divorce or separation.
Registered retirement savings plans (RRSPs), including spousal RRSPs, accumulated during the marriage are generally considered to be part of the marital property. Each spouse would be entitled to share equally the value of RRSPs in either spouse’s name.
As with other assets, the value of any RRSPs you accumulated before the marriage is still yours, if you can provide proof. That said, growth in those RRSPs during the marriage is still part of marital property.
How divorce or separation affects spousal RRSPs
Once a couple has separated, spousal RRSP contributions can no longer be made and the spousal designation must be removed from the RRSP account.
Splitting RRSP assets tax-efficiently
If you need to move RRSP assets from one spouse to another as part of your divorce or separation settlement, you can make an RRSP transfer by instructing the RRSP issuer and using form T2220. The transfer shouldn’t result in any immediate tax impact for either spouse regardless of RRSP contribution room, as long as the transferred amount stays in the recipient spouse’s RRSP.
Other important considerations
- Remember to change your RRSP beneficiary designations unless you still want your former spouse to receive your RRSP assets after you die.
- Under the Canada Revenue Agency’s Home Buyers’ Plan, you may be able to withdraw up to $35,000 from your RRSP, without immediate tax consequences, to buy or build a new home. Under certain conditions, this can even help you buy out your spouse’s half of a former matrimonial home.