My father has an RRIF with one investment firm and we just switched it to a different firm. I was told by the investor at the new company that the remaining monthly RRIF payments for 2017 have to be payed by the previous company in one lump sum. Is this correct? How long do they have to do this? The RRIF transfer is 99% complete and should be done this week.
Thank you,
Ian
RRIF Payment When Transferring To a Different Company
Re: RRIF Payment When Transferring To a Different Company
Maybe. IIRC the rule is that the company holding the RIF at the beginning of the year is responsible for ensuring the minimum payment for the year is paid to the annuitant.
So your father's monthly contracted payments over the year may total more than his required minimum so he may not get as much money as he thinks he will after the transfer, especially if he has already rec'd monthly pymts exceeding his minimum for the year.
He may have to request a pymt from the new company for any difference if he needs the money.
I cannot confirm what the requirements are for timing of this payment but I believe most companies usually submit at the same time as the funds are send to the other company. At the very latest I would suggest within 30 days of the transfer.
So your father's monthly contracted payments over the year may total more than his required minimum so he may not get as much money as he thinks he will after the transfer, especially if he has already rec'd monthly pymts exceeding his minimum for the year.
He may have to request a pymt from the new company for any difference if he needs the money.
I cannot confirm what the requirements are for timing of this payment but I believe most companies usually submit at the same time as the funds are send to the other company. At the very latest I would suggest within 30 days of the transfer.
Re: RRIF Payment When Transferring To a Different Company
30 days make sense but in practice I am of the opinion it might take much longer
on a related topic, I have no proof, but many moons ago i moved some rrsp funds from three companies to one to simplify things
as i remember it took a long time I and i had to persist after I got the run around. I even had to phone and got quite nasty but refrained from using profanity
It all worked out in the end thanks in large measure to my rudeness
so don't be shy if you think it needs be done
on a related topic, I have no proof, but many moons ago i moved some rrsp funds from three companies to one to simplify things
as i remember it took a long time I and i had to persist after I got the run around. I even had to phone and got quite nasty but refrained from using profanity
It all worked out in the end thanks in large measure to my rudeness
so don't be shy if you think it needs be done