Who is a qualifying survivor for the refund of premiums?

A qualifying survivor is either: (1) the deceased's spouse or common-law partner at the time of death, OR (2) a financially dependent child or grandchild of the deceased. A financially dependent child is one whose net income in the year before death was not more than the basic personal amount (approximately $16,129 in 2026). Financially dependent children with a disability may qualify at a higher income threshold. Adult children with normal income do not qualify — the RRSP amount would be fully included in the deceased's income instead.

What does Box 18 on the T4RSP mean?

Box 18 on the T4RSP slip is labelled "Refund of premiums." It shows the amount from the RRSP that has been designated to a qualifying survivor and is eligible for special rollover treatment. The qualifying survivor reports this amount as income on their tax return but may offset it entirely by contributing the same amount to their own RRSP or RRIF (no contribution room needed). Box 16 on the T4RSP shows regular RRSP withdrawals; Box 18 is the death-rollover amount. Box 28 shows amounts going to non-qualifying beneficiaries, which become income on the deceased's terminal return.

Does the refund of premiums use up RRSP contribution room?

No. This is one of the most important features of the refund of premiums. A qualifying survivor can contribute the refund of premiums amount to their own RRSP (or RRIF) without it being treated as an ordinary RRSP contribution — it does not reduce their available contribution room. This means a surviving spouse who has already maximized their own RRSP can still receive the full rollover and continue deferring the inherited balance. The deduction is claimed on Schedule 7 of the qualifying survivor's tax return.

What are the options for a financially dependent child who receives a refund of premiums?

A financially dependent child under 18 who is not disabled must use the refund of premiums to purchase a term-certain annuity that pays out until the child turns 18. This provides some tax deferral — the child pays tax on the annuity payments over time rather than all at once. A financially dependent child with a disability has more options: the amount can be rolled to the child's own RRSP, RRIF, or Registered Disability Savings Plan (RDSP). The RDSP rollover is especially valuable — it shelters the amount long-term and is not subject to RDSP lifetime contribution limits when it comes from a refund of premiums.

What is the deadline to use the refund of premiums?

The qualifying survivor must contribute the refund of premiums amount to their RRSP or RRIF on or before December 31 of the year following the year in which it was received. CRA provides this extended window beyond the normal RRSP contribution deadline. If the amount is not contributed within this window, the full amount is included in the qualifying survivor's income in the year received, with no offsetting deduction. Given the significant tax at stake, meeting this deadline is critical — set a calendar reminder as soon as the T4RSP is received.

What Is a Refund of Premiums on an RRSP? | CRA Term Explained

Q: What is a refund of premiums on an RRSP?

A refund of premiums is the term used in the Income Tax Act to describe amounts paid from a deceased person's RRSP to a qualifying survivor. Despite the confusing name, it has nothing to do with insurance premiums. It refers to the original contributions (called "premiums" in the Income Tax Act's original language) being "refunded" to a qualifying person rather than being taxed in the deceased's hands. The refund of premiums is reported in Box 18 of the T4RSP slip. The key benefit is that the qualifying survivor can contribute this amount to their own RRSP or RRIF without using contribution room — deferring the tax.

What Is a Refund of Premiums on an RRSP?

When a Canadian dies with an RRSP, the CRA uses the term “refund of premiums” to describe the amount that can be rolled over tax-free to a surviving spouse or dependent child. The terminology comes from the original language of the Income Tax Act, where RRSP contributions were called “premiums.” Understanding this term helps surviving family members navigate the T4RSP slip and claim the rollover correctly.

Refund of Premiums at a Glance

Feature	Details
Income Tax Act reference	s.146(8) — “refund of premiums”
Who can receive it	Qualifying survivor only
T4RSP box	Box 18 — “Refund of premiums”
Tax on receipt	Included in qualifying survivor’s income UNLESS rolled over
RRSP contribution room needed	❌ No — special designation overrides room rules
Deadline to roll over	December 31 of year following year of receipt

Who Is a Qualifying Survivor?

Person	Qualifies?	Conditions
Spouse or common-law partner	✅ Yes	Must have been spouse/CLP at date of death
Separated spouse (not divorced)	Depends	Provincial family law affects this — consult a lawyer
Financially dependent child (any age, disabled)	✅ Yes	Net income ≤ disability threshold in prior year
Financially dependent child under 18 (not disabled)	✅ Yes	Net income ≤ basic personal amount (~$16,129)
Adult child with normal income	❌ No	Not financially dependent — does not qualify
Grandchildren	✅ Potentially	Must meet financial dependency test
Parents, siblings, friends	❌ No	Never qualify as qualifying survivors

What the T4RSP Shows at Death

T4RSP box	What it represents	Tax treatment
Box 18 — Refund of premiums	Amount to qualifying survivor	Deferred if rolled to RRSP/RRIF
Box 28 — Other income	Amount to estate (non-qualifying)	Included in deceased’s terminal T1 income

If the beneficiary is a qualifying survivor and the full RRSP is designated, only Box 18 is used. If the beneficiary is not a qualifying survivor (e.g., an adult child with income), the amount appears on Box 28 and becomes income on the deceased’s terminal return — taxed fully.

Rollover Options by Qualifying Survivor Type

Qualifying survivor	Rollover options
Spouse or common-law partner	Contribute to own RRSP or RRIF — no contribution room required
Dependent child under 18, not disabled	Must purchase a term-certain annuity to age 18
Dependent child who is disabled	Contribute to own RRSP, RRIF, or RDSP — most flexible
Dependent grandchild	Same options as dependent child based on circumstances

Surviving Spouse: How the Rollover Works

Step	Action
1	Financial institution issues T4RSP with Box 18 filled
2	Surviving spouse includes Box 18 amount on their T1 return
3	Surviving spouse contributes the amount to own RRSP or RRIF
4	Files Schedule 7 to claim deduction — offsets Box 18 income
5	Net tax: $0
6	Ongoing: surviving spouse pays tax on future RRSP/RRIF withdrawals

Financially Dependent Child (Under 18, Not Disabled)

Step	Action
1	Financial institution issues T4RSP with Box 18 to dependent child
2	Child (or guardian) purchases a term-certain annuity to age 18
3	Annuity pays periodic amounts to child each year
4	Child pays income tax on annuity payments each year (likely low rate)
5	No lump-sum income inclusion — tax spread over remaining years to 18

Financially Dependent Disabled Child: RDSP Rollover

Feature	Details
RDSP rollover	Refund of premiums can go directly to the child’s RDSP
Lifetime RDSP contribution limit bypassed	✅ Rollover does not count toward the $200,000 lifetime RDSP limit
Tax deferral	Funds in RDSP grow tax-sheltered
Required form	CRA Form RC4625
Very valuable	A disabled adult dependent can shelter a large RRSP entirely

Why the Term Matters

Context	Why “refund of premiums” matters
T4RSP slip	Box 18 label is exactly “Refund of premiums” — not “spousal rollover” or “transfer”
CRA guides	CRA technical documentation uses this phrase — helpful when Googling for authoritative information
Financial institution paperwork	Forms may ask for designation of “refund of premiums” rather than using plain language
Tax professional communication	Using the right term avoids confusion when working with an accountant or tax preparer

Deadline and Consequences

Event	Deadline / consequence
Rollover contribution to RRSP/RRIF	By December 31 of year following receipt
Late contribution (missed deadline)	Full amount included in qualifying survivor’s income — no deduction
No RRSP/RRIF available (e.g., over 71)	Surviving spouse over 71 must use RRIF as receiving vehicle

Bottom Line

Refund of premiums is the technical CRA term for the amount a qualifying survivor receives from a deceased’s RRSP — and it unlocks a powerful tax deferral that requires no RRSP contribution room. Spouses can roll the full amount into their own RRSP or RRIF. Dependent disabled children can use the RDSP rollover, which is one of the most underused estate planning tools available to families with disabled members. Recognizing the term on the T4RSP Box 18 and meeting the rollover deadline are the two critical actions qualifying survivors must take.