RRIF Minimum Withdrawal: The Table and the Rules
The prescribed factor by age, the spouse's-age election, and the withholding and treaty rules for a RRIF owner living in the United States
Reviewed by the Fairlight Accounting cross-border tax team — U.S. & Canadian Tax Desks
A registered retirement income fund (RRIF) must pay out a minimum amount every year, starting the year after it is opened: the fund's value on January 1 times a prescribed factor based on the annuitant's age — 5.28 percent at 71, rising to 20 percent at 95. Non-residents face 25 percent withholding, reduced to 15 percent for periodic payments.
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When does the minimum start?
An RRSP must be converted to a RRIF (or an annuity, or cashed out) by December 31 of the year the annuitant turns 71. No withdrawal is required in the year the RRIF is opened; the first minimum is due in the following calendar year and every year after. A RRIF opened before 71 — some people convert earlier for the pension income credit at 65 or for income-splitting — follows the same rule: no minimum in the opening year, then the age-based minimum annually.
The prescribed factor table
| Age at January 1 | Factor | Age at January 1 | Factor |
|---|---|---|---|
| Under 71 | 1 ÷ (90 − age) | 82 | 7.38 percent |
| 71 | 5.28 percent | 83 | 7.71 percent |
| 72 | 5.40 percent | 84 | 8.08 percent |
| 73 | 5.53 percent | 85 | 8.51 percent |
| 74 | 5.67 percent | 86 | 8.99 percent |
| 75 | 5.82 percent | 87 | 9.55 percent |
| 76 | 5.98 percent | 88 | 10.21 percent |
| 77 | 6.17 percent | 89 | 10.99 percent |
| 78 | 6.36 percent | 90 | 11.92 percent |
| 79 | 6.58 percent | 91 | 13.06 percent |
| 80 | 6.82 percent | 92 | 14.49 percent |
| 81 | 7.08 percent | 93 | 16.34 percent |
| — | — | 94 | 18.79 percent |
| — | — | 95 and over | 20.00 percent |
The factors match the CRA's current chart; they were last revised in 2015. Older "qualifying RRIFs" (from before 1993) use 1 ÷ (90 − age) through 71 — 5.26 percent at 71 rather than 5.28 — and the same factors as every other RRIF from 72 on. Below 71, the formula 1 ÷ (90 − age) gives 3.33 percent at 60, 4.00 percent at 65, and 5.00 percent at 70.
The spouse's-age election
At the time the RRIF is set up, the annuitant may elect to base the minimum on a younger spouse's or common-law partner's age. A 71-year-old with a 64-year-old spouse would withdraw 1 ÷ (90 − 64) = 3.85 percent instead of 5.28 percent — a smaller mandatory withdrawal, more tax deferral, and a longer-lasting fund. The election must be made before the first payment from the fund and cannot be changed later, even if the spouse dies or the couple separates. It costs nothing and is the single most useful RRIF decision for couples with an age gap.
Withholding and tax for Canadian residents
The minimum amount is paid with no withholding; the annuitant reports it as income and pays tax with the return (or through instalments). Withdrawals above the minimum are withheld at 10, 20, or 30 percent depending on the amount (10 percent up to C$5,000, 20 percent over C$5,000 to C$15,000, 30 percent above; in Quebec 5, 10, or 15 percent federal plus 14 percent Quebec), which is a prepayment, not the final tax. RRIF income after 65 qualifies for the pension income credit and for pension income splitting with a spouse (up to 50 percent), which is why some retirees convert part of an RRSP to a RRIF at 65 rather than 71.
The RRIF owner living in the United States
A non-resident of Canada pays Part XIII withholding on RRIF payments instead of filing a Canadian return: 25 percent by default, reduced to 15 percent under the Canada–U.S. treaty for "periodic pension payments." Canada's Income Tax Conventions Interpretation Act defines a periodic pension payment from a RRIF as up to the greater of twice the minimum amount or 10 percent of the fund's value at the start of the year — withdrawals within that band are periodic (15 percent); the excess is a lump sum (25 percent). The 15 percent is the final Canadian tax, and the U.S. resident reports the withdrawal as pension income on Form 1040 (the treaty's deferral of the plan's growth ends at distribution — the RRSP guide covers the U.S. treatment), claiming the Canadian tax as a foreign tax credit on Form 1116. The NR4 slip reports the payment and the withholding. The spouse's-age election still applies; the minimum is still computed the same way; and a U.S. resident who withdraws more than the periodic band to fund U.S. living costs pays 25 percent on the excess with no way to file for a refund unless the section 217 election (a Canadian return on the pension income) produces a lower tax — occasionally worth computing.
Worked example
A retired teacher, 72, living in Arizona, has a RRIF worth C$400,000 on January 1 and a spouse who is 68; she did not make the spouse's-age election when she opened the fund at 71. Minimum for the year: 5.40 percent × C$400,000 = C$21,600. Periodic band under the treaty: the greater of twice the minimum (C$43,200) or 10 percent of the fund (C$40,000) — C$43,200. She withdraws C$36,000: within the band, so Canada withholds 15 percent (C$5,400) as the final Canadian tax, reported on an NR4. On her U.S. return she reports the withdrawal (converted at the exchange rate on the payment dates) as pension income and claims the C$5,400 as a foreign tax credit. Had she withdrawn C$60,000, the C$16,800 above the band would have been withheld at 25 percent. And had she made the spouse's-age election at 71, this year's minimum would have been 1 ÷ (90 − 68) = 4.55 percent — about C$18,180 — and the periodic band would have been C$40,000, set by the 10 percent floor.
Frequently asked questions
When does the RRIF minimum start?
The year after the RRIF is opened. An RRSP must become a RRIF by December 31 of the year you turn 71; the first minimum withdrawal is required in the following year.
What is the RRIF minimum at 71?
5.28 percent of the fund's value on January 1. The factor rises each year — 5.82 percent at 75, 6.82 percent at 80, 8.51 percent at 85, 11.92 percent at 90, and 20 percent at 95 and beyond.
Can I use my spouse's age?
Yes, if you elect it before the first payment from the RRIF. A younger spouse's age produces a lower minimum. The election is permanent.
How is a RRIF withdrawal taxed for a resident of the United States?
Canada withholds 15 percent under the treaty on periodic payments (up to the greater of twice the minimum or 10 percent of the fund, as defined in Canadian law) and 25 percent on the excess; the U.S. resident reports the withdrawal as pension income and claims the Canadian tax as a foreign tax credit.
Official sources
The CRA states: “As the carrier of a RRIF, you have to pay a minimum amount to the annuitant every year after the year in which the RRIF is set up. You calculate this amount by multiplying the fair market value (FMV) of the property held in the RRIF at the start of the year by a prescribed factor.” — Canada Revenue Agency, Minimum amount from a RRIF, https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/completing-slips-summaries/t4rsp-t4rif-information-returns/payments/minimum-amount-a-rrif.html
Publication 597 states: “Under Article XVIII, pensions and annuities from Canadian sources paid to U.S. residents are subject to tax by Canada, but the tax is limited to 15% of the gross amount (if a periodic pension payment) or of the taxable amount (if an annuity).” — Internal Revenue Service, Publication 597, Information on the United States–Canada Income Tax Treaty, https://www.irs.gov/publications/p597
Next step
Fairlight Accounting is a cross-border accounting and tax practice with a U.S. Tax Desk and a Canadian Tax Desk. Our U.S. Tax Desk and Canadian Tax Desk handle RRIF withdrawal planning for U.S. residents — the periodic-payment band, NR4 reconciliation, Form 1116 credits, the section 217 computation, and RRSP-to-RRIF conversion timing. See pricing or book a call.
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