Taxed on death in substantially the same way as an RRSP, with a spousal rollover available.
The Canadian position
Taxed on death in substantially the same way as an RRSP, with a spousal rollover available.
Whether an asset passes through the estate determines both the probate cost and who ultimately receives it.
The Islamic position
Passes to the named beneficiary outside the estate, so it is not divided by the fixed shares.
The fixed shares apply only to the net estate. Anything passing outside it is never divided by faraid.
The four Sunni schools are not recorded as differing materially on this point in the sources reviewed. Where your own case turns on it, put it to a scholar of your school.
What to do about it
- Confirm how your RRIF is currently held or designated.
- Decide deliberately whether it should follow the shares.
- Take tax advice before changing a designation.
- Re-check whenever the will changes.
General information, not legal or religious advice. Inheritance depends entirely on the exact family circumstances. Confirm the Canadian position with a lawyer in your province and any religious ruling with a qualified scholar.
Citations & sources
Every factual claim on this page traces to one of the references below. Legislation and dollar thresholds change — verify against the primary source before relying on any figure.
- Surah an-Nisa 4:11 — shares of children and parents — Quran.com
- Surah an-Nisa 4:12 — shares of spouses and uterine siblings — Quran.com
- Surah an-Nisa 4:176 — the kalalah verse — Quran.com
- Research Papers — Cambridge Muslim College
- Research — Cambridge Muslim College
- Academics — Islamic law and theology curriculum — Zaytuna College
- Encyclopaedia of Islam — Brill
- Death of an RRSP annuitant — Canada Revenue Agency
- What to do when someone has died — Canada Revenue Agency
- Income Tax Act, RSC 1985, c 1 (5th Supp) — Justice Laws Canada
- Insurance trust ontario life insurance proceeds — Treadstone Law
- Pension beneficiary ontario — Treadstone Law
- Rdsp holder capacity guardianship adult beneficiary ontario — Treadstone Law
- Employer group rrsp contribution taxable benefit — Treadstone Law
- Group rrsp vs individual rrsp death processing ontario — Treadstone Law
- Naming spouse common law beneficiary ontario — Treadstone Law
- Wills & estates practice — Treadstone Law