Building a Secure Future: A Family Guide to the RDSP

An RDSP guide for people living with a disability and the families who support them.

Why the RDSP matters

A Registered Disability Savings Plan (RDSP) is a long-term savings plan for Canadians who qualify for the Disability Tax Credit. No registered plan gets more government support.

• 300% matching grant on your first $500 a year, for most families.
• $1,000 a year in bond for lower-income beneficiaries, with no contribution needed.
• $90,000 in lifetime government money available: $70,000 grant plus $20,000 bond.

Source: Employment and Social Development Canada. Income thresholds are for 2026 and indexed each year.

The government money

Save $1,500, get $3,500

With family income up to $117,045, the government adds $3 for each of the first $500 and $2 for each of the next $1,000. Above that, $1 for $1 on the first $1,000.

Up to $1,000 a year

Paid in full when family income is $38,237 or less, and partly up to $58,523. Nothing has to be contributed to receive it.

Parents, then the beneficiary

Until the year the beneficiary turns 18, it’s the parents’ income. From age 19, it’s the beneficiary’s own (and their spouse’s), so many adults qualify for the full grant and bond.

Who can open one

1. Approved for the Disability Tax Credit.
2. A resident of Canada.
3. Has a Social Insurance Number.
4. Under age 60 when the plan is opened.

Opening late? Up to 10 years can be caught up. Unused grant and bond room from the past 10 years carries forward. In a single year you can catch up as much as $10,500 in grant and $11,000 in bond.

Key ages to know

• Before 60: Open the plan. Any age up to 59. The sooner it opens, the more grant and bond it can collect.
• Up to 49: Grants and bonds. Paid until the end of the year the beneficiary turns 49.
• Up to 59: Contributions. Up to $200,000 in total, with no yearly limit.
• By 60: Income begins. Lifetime payments must start by the end of the year the beneficiary turns 60.

For parents and grandparents

The RDSP is one of the best tools you have to make sure the person you love is looked after, during your lifetime and after.

• Contribute now. Anyone can give to the plan with the plan holder’s permission, and every eligible dollar attracts grant.
• Leave your RRSP or RRIF. At your death it can roll tax-deferred into the RDSP of a financially dependent child or grandchild.
• Move RESP growth. If education isn’t in the cards, RESP earnings may be rolled into the same child’s RDSP.

Protects provincial benefits. In New Brunswick, money held in an RDSP is fully exempt when income assistance is assessed, and payments of up to $800 a month are exempt as well.

Getting started checklist

• Apply for the Disability Tax Credit (CRA form T2201), completed with a medical practitioner.
• Decide who will be the plan holder, and who takes over if you can’t.
• Make sure the beneficiary files a tax return every year from age 17.
• Contribute at least $1,500 a year to collect the full grant.
• Ask about catching up on up to 10 years of missed grant and bond.
• Review your will and RRSP or RRIF beneficiaries with the RDSP in mind.

Taking money out

The RDSP is built for the long term. Payments can be regular or one-time, and they don’t reduce federal benefits like the Canada Child Benefit, OAS or GIS.

• Your contributions: Come back out tax-free.
• Grants, bonds and growth: Taxed as the beneficiary’s income, often at a low rate or not at all.

Know the 10-year rule

1. Grants and bonds need to stay put. Money paid in during the last 10 years is held back.
2. Early withdrawals cost. For each $1 taken out, $3 of recent grant and bond goes back to Ottawa.
3. Closing the plan means repaying all grant and bond from the past 10 years.
4. Plan withdrawals with me so you keep as much government money as possible.

Protect the plan, too. If you weren’t here, who would keep contributing? Life insurance can fund the RDSP or a trust for your loved one’s care, so their security doesn’t depend on you being around.

Let’s talk about their future

I’ll help you open the plan, collect every grant and bond available, and fit it into your family’s estate plan.

Book a conversation with Michael, or call the office at 506-406-6100 (cell 506-440-6196). Email: [email protected]. Ask for a printed copy of this brochure at your next meeting.

For general information only; not tax or legal advice. Grant and bond amounts, income thresholds and RDSP rules are set by the Government of Canada and can change. Provincial benefit rules vary.