The tax advantages of investing in registered investment accounts over the last few decades have resulted in most Canadians accumulating significant assets in their RRSP's and RRIF's (Registered Retirement Plans). 

It is most common that spouses name each other as beneficiary of registered plans since CRA allows these assets to transfer to the surviving spouse without tax implications. 

At the death of the last spouse however, all RRSP and RRIF accounts are deemed to be sold.  The result is that the value of these accounts are added to the income of the deceased in the year of death.  This consequence is both good and bad - it's likely that close to 50% of the value could be lost to taxes. 

Since Canadians are allowed to give away 100% of their income in the year of death, this additional RRSP/RRIF 'income' offers an excellent opportunity for generous giving.  Gifting 100% of RRSP/RRIF accounts can completely eliminate the tax bill resulting from this income through the tax credit generated by the donation receipts received. 

How it works:

A.  In the case of two living spouses, CNCF could be named the contingent beneficiary of registered accounts so that in the event of a common disaster, the funds would be donated to CNCF for distribution to charities of the donors choice. 

B.  In the case of one remaining spouse or a single individual, naming CNCF (or another charitable organization) as the beneficiary of your registered accounts (RRSP and RRIF) means a donation will be made in the year of death equal to the disposition value of these accounts.  Since the income of the deceased as been increased by the same value, the resulting tax credit can be claimed entirely in the year of death, completely offsetting the tax burden caused by the disposition of the registered account. 

1. Contact your financial advisor or the holder of your RRSP or RRIF investments to change the beneficiary on your account.  Name CNCF as the primary beneficiary if you wish to donate the entire account at your death.  Name CNCF as the secondary beneficiary if you have a surviving spouse at this time.
2. Complete a Letter of Direction and send it to CNCF in order to leave your recommendations on the distribution of these monies to charities of your choice once they are received by CNCF.
3. OR if you would like your gift to be used to establish a legacy fund, complete the form and send it to CNCF.  Be sure to include the contact information of your fund successors. 
4. Advise your family and your financial advisor of your decision.

Contact us if you would like more information.  CNCF is here to serve you.

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