How Does an RDSP Work?
RDSP contributions can be made until the end of the year in which the beneficiary turns 59 and are eligible for grants such as the Disability Savings Grant. RDSP contributions are not tax-deductible.
Save for long-term financial security
A Registered Disability Savings Plan (RDSP) is designed to help people who are eligible for the Disability Tax Credit save for their long-term financial security. An RDSP can bring together personal savings, investment growth, and valuable government grants and bonds to help build greater financial security for the future.
How an RDSP can help
An RDSP offers a tax-sheltered way to save and invest over the long term. Parents, family members, and others can contribute with permission from the plan holder, making it possible for people who care about the beneficiary to help support their financial future.
Make the most of government grants and bonds
An RDSP may be eligible for two Government of Canada programs:
Canada Disability Savings Grant
The government may match contributions to an RDSP, depending on the beneficiary's family income and the amount contributed. Matching grants can be as much as 300%, up to a lifetime maximum of $70,000.
Canada Disability Savings Bond
Eligible people with low or modest incomes may receive up to $1,000 a year, to a lifetime maximum of $20,000. Personal contributions aren't required to receive the bond. Government grants and bonds are available until the end of the year in which the beneficiary turns 49.
RDSP at a glance
- Eligibility: The beneficiary must be approved for the Disability Tax Credit, have a valid Social Insurance Number, be a resident of Canada when the plan is opened, and meet the age requirements.
- Contributions: There is no annual contribution limit, with a lifetime contribution limit of $200,000.
- Time to contribute: Contributions can be made until the end of the year in which the beneficiary turns 59.
- Tax advantages: Contributions aren't tax-deductible, while investment earnings grow tax-sheltered within the plan.
- Help from others: With permission from the plan holder, family members and others can contribute to the RDSP.
Pre-authorized payments to your RDSP make it so much easier to save. Contribute every month and watch your savings add up!
Learn more about RDSPs
Understanding RDSPs: Registered Disability Savings Plans
Learn more about how RDSPs work, who can open one, and the government grants and bonds that may be available.
Financial steps for Canadian parents of a child with a disability
Explore some of the broader financial considerations for families, including the Disability Tax Credit, RDSPs, estate planning, and other sources of support.