Retirement Planning

CRA Takes 54% Of Your RRSP When You Die (Unless You Do This)

How a $1 million RRSP can create a $500,000+ tax bill at death – and the little-known planning strategy that may help families keep far more of their wealth.

• RRSP
• Family Trust
• Beneficiary Designations
• +3 more

Jun 11, 2026

The RRSP Trap: Why CRA Takes 54% Of Your RRSP When You Die (And How To Stop It)

A $1 million RRSP can trigger a $540,000 tax bill at death. Learn the little-known strategy that can legally reduce that tax burden and preserve more wealth for your family.

Jun 10, 2026

Same $1M RRSP, $390,000 Difference

Same $1M RRSP. Same family. $390,000 difference.

CRA Takes 54% Of Your RRSP When You Die

CRA can take 54% of your RRSP when you die. Not your business. Not your real estate. The retirement savings you built one paycheque at time. Here's what almost nobody tells you: your entire RRSP lands on your final tax return as income, all in one year. On a $1M RRSP, combined with the deemed disposition on the rest of your estate, the tax can hit $540,000. But there's a provision in the Income Tax Act that can redirect your RRSP to a minor child or grandchild, taxed at their rate instead of yours. It can drop the total tax to around $150,000. That's a $390,000 difference. Same RRSP. Same family. Same law.