Marriage breakdown involves dividing up the funds within the registered plans of both partners.
A T2220 (Transfer from an RRSP or a RRIF to another RRSP or RRIF on marriage breakdown or common-law partnership) is required to be completed and sent to Head Office. If the T2220 is signed by both parties, no additional documentation is required. If the T2220 is signed by only one of the parties, we will require a copy of the documentation supporting the marriage breakdown/divorce.
Prior to October 2003, the spousal designation could not be removed due to marriage breakdown. However, as of October 2003, the Canadian Revenue Agency (CRA) has decided that the spousal designation on a registered policy can be removed following marriage breakdown provided the following conditions are met:
Condition 1 - Proof of separation caused by breakdown
The annuitant and contributor must be living apart at the time of the request, and the issuer or carrier must be satisfied with the proof of the breakdown of their marriage or common-law partnership.
The issuer or carrier should ask for a written statement, signed and dated by the annuitant. In the case of an RRSP, the annuitant should state that he or she is no longer living with the person who is identified as the contributor because of the breakdown. In the case of a RRIF, the annuitant should state that he or she is no longer living with the person identified as the contributor to any RRSP from which transfers were made to the RRIF in question because of the breakdown of their relationship.
If documentary evidence of the breakdown exists (for example, a separation agreement or divorce decree), the issuer or carrier may also ask for a copy of the document.
The written statement and documentary evidence of the breakdown do not have to be filed with the Canada Revenue Agency. The issuer or carrier should keep a copy of these documents for their own records.
Condition 2 - No contributions
There must be no spousal or common-law partner contributions to any of the annuitant's RRSPs (i.e., RRSPs held with any issuer) for the year of the request and the two previous years.
The annuitant's written statement should certify that the spouse, common-law partner, former spouse, or former common-law partner did not contribute to any of the annuitant's RRSPs in the calendar year of the request nor in the two immediately preceding calendar years.
Condition 3 - No withdrawals
There must be no withdrawals from the spousal or common-law partner RRSP during the year of the request. In the case of a RRIF, no more than the minimum amount must be withdrawn.
The annuitant's written statement should certify that he or she did not make any withdrawals from the RRSP in the year of the request, or that he or she withdrew no more than the minimum amount from the RRIF.
When these 3 conditions are met
When these 3 conditions are met, the issuer or carrier may remove the contributor information from the spousal or common-law partner RRSP or RRIF.
Alternatively, the property can be transferred to a new or existing individual RRSP or RRIF in the annuitant's name. In this case, the recipient issuer or carrier is not required to include any information about a contributor who is not the annuitant.
Where these 3 conditions are not met
Where these 3 conditions are not met, information about the contributor cannot be removed from a spousal or common-law partner RRSP or RRIF unless the spouse or common-law partner who contributed to the plan or fund is deceased.
