- RRSPs and RRIFs allow the account holder to name a beneficiary directly on the plan, separate from anything said in the will.
- If no beneficiary is named (or the named beneficiary has already died and no contingent beneficiary was named), the RRSP or RRIF proceeds are paid to the deceased's estate instead of…
- A common misconception is that an RRSP or RRIF becomes tax-free once the holder dies.
A Registered Retirement Savings Plan (RRSP) or Registered Retirement Income Fund (RRIF) is often one of the largest assets a person owns — and whether it has a named beneficiary can make a real difference in both the tax bill and the probate cost when the account holder dies. When no beneficiary is named, the account doesn't disappear — it simply follows a different, generally less favourable, path.
This article explains what happens to an RRSP or RRIF with no named beneficiary in Ontario, both for income tax purposes and for the Estate Administration Tax (Ontario's probate fee).
Why the Beneficiary Designation Matters
RRSPs and RRIFs allow the account holder to name a beneficiary directly on the plan, separate from anything said in the will. A named beneficiary — particularly a spouse, common-law partner, or in some cases a financially dependent child or grandchild — can allow the account's value to roll over to that person without immediate tax, and the account generally passes outside the estate, meaning it isn't counted for probate purposes.
What Happens Without a Named Beneficiary
If no beneficiary is named (or the named beneficiary has already died and no contingent beneficiary was named), the RRSP or RRIF proceeds are paid to the deceased's estate instead of directly to an individual. From there, the funds are distributed according to the will, or under Ontario's intestacy rules if there is no will.
The Tax Bill Doesn't Disappear
A common misconception is that an RRSP or RRIF becomes tax-free once the holder dies. It does not. As a general rule, the fair market value of the RRSP or RRIF is included as income on the deceased's final tax return in the year of death, unless it qualifies for a tax-deferred rollover to a surviving spouse, common-law partner, or an eligible dependent. When the funds pass into the estate with no named beneficiary, achieving that rollover treatment can be more complicated — it isn't automatically lost, but it depends on who ultimately receives the funds under the will and whether they qualify, so this is a scenario where getting proper tax advice before finalizing the estate matters.
The Probate Cost: Estate Administration Tax
Beyond income tax, there's a second cost to consider. Assets that pass through the estate — because there was no named beneficiary or joint ownership with right of survivorship — are included when calculating Ontario's Estate Administration Tax (often called probate fees). As of mid-2026, that tax is $0 on the first $50,000 of estate value, and $15 per $1,000 (1.5%) on value above that, rounded up to the nearest $1,000 — figures that should be verified before relying on them, since they can change. An RRSP or RRIF with a named beneficiary generally avoids this calculation altogether, because it never becomes part of the estate.
Named Beneficiary vs. No Beneficiary: A Comparison
| Named beneficiary (e.g., spouse) | No beneficiary named | |
|---|---|---|
| Where the money goes | Directly to the named person | Into the estate, then distributed under the will/intestacy |
| Counted for Estate Administration Tax? | Generally no | Generally yes |
| Possible tax-deferred rollover | Often available for a qualifying spouse/dependant | Depends on who ultimately receives the estate funds and their eligibility |
| Timing of payout | Can often be processed directly with the financial institution | Waits on the broader estate administration process |
What to Do If You Notice a Missing Designation
- Check the beneficiary designation on file with the RRSP/RRIF issuer directly — don't assume the will covers it.
- If there's no beneficiary named, name one, and name a contingent beneficiary in case the first one predeceases you.
- Review designations after major life events — marriage, separation, divorce, or the death of a previously named beneficiary — since old designations don't update themselves.
- If you're administering an estate where an RRSP or RRIF has already fallen in with no beneficiary named, get tax advice before assuming the worst-case income tax treatment applies.
Frequently asked questions
If my spouse is named as beneficiary, does the RRSP still count toward Estate Administration Tax?
Generally no. Assets that pass directly to a named beneficiary outside the will typically aren't included in the value used to calculate Ontario's Estate Administration Tax, because they don't pass through the estate.
Can I name my estate as the RRSP beneficiary on purpose?
You can, but doing so generally brings the account back into the estate for both probate and administration purposes, which usually defeats the purpose of naming a beneficiary in the first place. Most people avoid naming the estate unless there's a specific reason to do so.
Does naming a beneficiary on the RRSP override what my will says?
Generally yes — a valid beneficiary designation on the plan itself usually takes priority over a general distribution clause in the will for that specific account, though the details can depend on the wording of both documents.
What if I have no idea whether a deceased family member named a beneficiary?
The financial institution holding the RRSP or RRIF can confirm whether a beneficiary designation is on file. If none exists, the funds are paid to the estate, and the executor administers them as part of the overall estate.
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