This blog post has been written by Darren G. Lund, Partner at Fasken LLP

With the holiday season having only recently passed (although in many ways it feels like a long time ago already), I am reminded of how easy it is for news items to get lost in the hustle and bustle of year-end planning and preparations. In the estate planning world, this past year-end contained a welcome development in Ontario.

The Succession Law Reform Act (“SLRA”) is the primary statute in Ontario that governs beneficiary designations for “plans” such a Registered Retirement Savings Plans (RRSP), Registered Retirement Income Fund (RRIF), Tax Free Savings Accounts (TFSA), and pensions (although pensions are also regulated under separate pension legislation). The SLRA sets out rules for how the annuitant/holder/member of such plans may make a beneficiary designation and revoke a beneficiary designation. So far, so good.

However, what happens if a person makes a beneficiary designation and subsequently becomes mentally incapable, such that they are not capable of managing their property going forward? If the person has made a continuing power of attorney, or a guardian of property has been appointed for the incapable person, can the attorney or guardian make or change a beneficiary designation on behalf of the incapable person?

Many practitioners would answer the above questions in the negative. Under the Substitute Decisions Act, 1992 (“SDA”), which governs powers of attorney and guardianships, the authority of an attorney under a continuing power of attorney, and a guardian of property, is broad, but the statute expressly states that they cannot “make a will”. Under the SLRA, a “will” is defined to include a “testamentary disposition”. Most practitioners take the view that a beneficiary designation is a testamentary disposition, or if not strictly a testamentary disposition then it is a “quasi-testamentary disposition” (hence the ambiguity). As a result, the prevailing view has been that an attorney or guardian cannot make or change a beneficiary designation on behalf of an incapable person.

In practice, exceptions have often been made for instances where the designation itself is not changing, especially if the power of attorney document contains an express power to permit that. This can arise, for example, if an annuitant under an RRSP attains age 71 and is required by law to convert the RRSP to a RRIF. The RRIF is a separate account, and since beneficiary designations relate to specific accounts, the beneficiary designation on the RRSP does not automatically transfer to the RRIF. The issue can also arise if the RRSP, RRIF, or TFSA is being transferred to a different financial institution, such that there will be a new account.

Professional organizations in Ontario have long advocated for changes to the SLRA to permit an attorney or guardian to make or change a beneficiary designation in certain circumstances. This advocacy has now yielded positive results. On December 11, 2025, Bill 46 received Royal Assent and became law. Bill 46 amends the SLRA to provide, in revised subsection 51(1.1), that:

(1.1) If a participant has designated a person by an instrument referred to in clause (1)(a) to receive a benefit payable under a plan on the participant’s death and if the plan is being converted, renewed, replaced or transferred, the participant’s attorney under a continuing power of attorney for property or the participant’s guardian of property may make a designation under subsection (1), by instrument signed by the attorney or guardian, in order to permit the same person to be designated under the plan that results from the conversion, renewal, replacement or transfer.

For added certainty, new subsection 51(1.2) clarifies that the provisions in the SDA that preclude an attorney or guardian from “making a will” on behalf of an incapable person do not prevent an attorney or guardian from making a designation under the new SLRA provision.

The amendments to the SLRA will not cover all situations. For example, they would not permit an attorney or guardian to change the identity of the designated beneficiaries. This could arise where all of the originally named beneficiaries have died, and there is an intention to change the designation to align with applicable distribution provisions in a will, while keeping the designated assets out of the estate. This restriction is no doubt intentional as a reasonable precaution to avoid potential abuse.

These amendments are a welcome development, and it is important to credit the legislature when it gets it right.