Are RRSP and TFSA proceeds subject to Ontario's estate administration tax?

In Ontario, registered accounts such as RRSPs, RRIFs, and TFSAs with a named beneficiary (or, in Quebec-specific rules, a successor holder for TFSAs) pass directly to the named beneficiary and do not form part of the estate. Because they bypass the estate entirely, they are not included in the estate value for estate administration tax (probate fee) purposes.

This is one of the most significant estate planning tools available: keeping beneficiary designations current on registered accounts can substantially reduce the taxable estate value and the estate administration tax owing, as well as speeding up the transfer of those funds to the intended recipient.

If no beneficiary is named — or if the named beneficiary has predeceased the account holder and no contingent beneficiary is designated — the account proceeds fall into the estate, become subject to estate administration tax, and must pass through the probate process. Reviewing and updating beneficiary designations is a straightforward step that can have a meaningful impact on the estate administration.