Registered Disability Savings Plan
Key Features of RDSPs
A Registered Disability Savings Plan (RDSP) is a means of supporting those who are disabled and in receipt of Disability Tax Credit to save for the future. Here are some important things to know about these savings plans:
- The person who is registered as disabled and who will benefit from the savings in the future is known as the beneficiary.
- The person who opens and manages the plan on an ongoing basis is known as the plan holder. The beneficiary and plan holder can be the same or different people.
- Payments can be made into the RDSP until the beneficiary is 59 years of age.
- Holding an RDSP does not mean that a beneficiary is no longer eligible to receive disability benefits.
- There is a lifetime contribution ceiling of $200,000 into the plan but there isn’t an annual cap on the value of contributions.
- While there is no tax due on the investment earnings as long as they remain in the plan and are not withdrawn, the contributions are not tax deductible.
- There are a couple of federal programs i.e.: the Canada Disability Savings Grant and the Canada Disability Savings Bond, in which the beneficiary may be eligible to receive significant government contributions into the RDSP.
- Regular payments must be taken from the plan by the time the beneficiary reaches the age of 60.
- The savings held within the plan can be invested in a variety of different ways, depending on which institution the account is held at.
View our guides:
- Registered Disability Savings Plan: Your Guide to Savings for a Secure Future
- Registered Disability Savings Plan: Building financial security for Canadians with disabilities
- RDSP Frequently Asked Questions