InfoCapsule 1: Overview of a Registered Disability Savings Plan

Preface

Registered Disability Savings Plans (RDSP) were introduced in 2008 and are long-term savings plans intended to help Canadians with severe and prolonged disabilities save for the future. To help savings grow, the Government of Canada will deposit the Canada Disability Savings Grant (CDSG) and the Canada Disability Savings Bond (CDSB) into the RDSP of eligible beneficiaries.

Opening an RDSP

To open an RDSP, the beneficiary must:

• be a resident in Canada
• have a valid Social Insurance Number (SIN)
• be eligible for the Disability Tax Credit (DTC)

The opening of an RDSP can be done up until December 31 of the calendar year in which the beneficiary turns 59 years old.

Contributions

To make contributions to the RDSP, the beneficiary must:

• be a resident in Canada
• have a valid SIN
• be eligible for the DTC

Contributions can be made to the RDSP until December 31 of the calendar year in which the beneficiary turns 59 years old.

The lifetime contribution limit is $200,000.

Canada Disability Savings Grant

To receive the CDSG, the beneficiary must:

• be a resident in Canada
• have a valid SIN
• be eligible for the DTC

The CDSG may be paid to the RDSP until December 31 of the calendar year in which the beneficiary turns 49 years old.

The CDSG is based on the family income and the contribution amounts made to the plan in a calendar year.

• If the family income is less than or equal to $111,733^{Footnote 1}:
  • a 300% matching rate is paid on the first $500 or less of annual contributions made to the RDSP, and
  • a 200% matching rate is paid on the next $1,000
• If the family income is greater than $111,733^{Footnote 1} or if no income information is available:
  • a 100% matching rate is paid on the first $1,000 or less of annual contributions made to the RDSP

The lifetime CDSG limit is $70,000.

Canada Disability Savings Bond

To receive the CDSB, the beneficiary must:

• be a resident in Canada
• have a valid SIN
• be eligible for the DTC

The CDSB may be paid until December 31 of the calendar year in which the beneficiary turns 49 years old.

The CDSB is based on the family income.

A contribution is not required to receive the CDSB if:

• the family income is less than or equal to $36,502^{Footnote 1}, $1,000 in CDSB will be paid to the RDSP
• the family income is greater than $36,502^{Footnote 1} but less than or equal to $55,867^{Footnote 1}, the amount of CDSB paid to the RDSP will be the result of the Canada Disability Savings Act formula
• the family income is greater than $55,867^{Footnote 1}, the CDSB will not be paid

The lifetime CDSB limit is $20,000.