Chapter 13. RDSP Receiving and depositing grant and bond

13.1.1 Order of payments

When multiple requests for the same beneficiary occur in the same monthly reporting period, the first successful one will receive the grant or bond payment.

13.1.2 Timeline for payments

Grant and bond payments on a successfully processed transaction are paid to the financial institution on the last business day of the month.

13.2.1 Criteria

In summary, the beneficiary must meet the following criteria:

• apply on or before December 31 of the year the beneficiary turns 49 years
• be a resident of Canada:
  • at the time the contribution is made
  • at the time application for the bond is made
  • immediately before the bond is paid
• be eligible for the Disability Tax Credit (DTC)
• have a valid social insurance number (SIN)
• not be deceased

For more detailed information on the grant and bond, refer to Chapter 9. RDSP Canada Disability Savings Grant and Chapter 10. RDSP Canada Disability Savings Bond.

13.2.2 Conditions

Conditions for the payment of grants and bonds for the holder.

1. For the Canada Disability Savings Grant (CDSG) and the Canada Disability Savings Bond (CDSB) the holder must:

• open an RDSP
• complete and submit a signed grant and bond application form directly to a financial institution
• ensure the beneficiary's family income information is on file at the Canada Revenue Agency (CRA)
• possess a valid SIN or business number (BN)
• review if the holder is an organization responsible for a beneficiary under the age of 18 and receive a children's special allowance for at least 1 month in the year

2. For CDSG only, the holder must authorize a contribution deposit into the RDSP

Conditions for the payment of grants and bonds to the beneficiary.

1. For both CDSG and CDSB:

• must have a valid SIN
• if beneficiary over the age of majority must:
  • have filed personal income tax returns for the past 2 years
  • continue filing income tax returns for all future taxation years
• if a beneficiary 18 years or under:
  • their parent or guardian must have filed taxes and applied for the Canada Child Benefit for the past 2 years
  • their parent or guardian must continue filing taxes while the beneficiary is under the age of 18

2. For CDSG only, must:

• not have contributed more than $200,000 to the RDSP
• not have received more than $70,000 in grant payments

3. For CDSB only, must not have received more than $20,000 in bond payments

Conditions for the payment of grants and bonds for the issuer.

1. For both CDSG and CDSB the issuer must:

• ensure the information on the application form is complete
• submit the information electronically to Employment and Social Development Canada (ESDC) for processing
• complete any required action resulting from processing with ESDC
• receive and distribute grant and bond payments to the RDSP
• provide a statement of account to the holder

13.3.1 When transactions are rejected

The ITS details the required format for each transaction type and provides the financial institution with the mandatory information required and validation rules for those transaction types. If transactions are not submitted in compliance with these formats and validation requirements, the transactions are rejected.

Each transaction error, whether due to problems in format or invalid data, is reported back to the financial institution for correction and resubmission. This is done electronically via the error files.

These transaction errors include:

• failure to correctly format the file
• failure to correctly format a transaction
• failure to supply the necessary information for a mandatory field
• failure to comply with the CDSP system business rules

The error files contain 2 different reports, error report (RT 801) and severe errors report (RT 851). A list of error codes and possible resolution can be found appended to this document.

13.3.2 Error codes

If there is an error in a transaction, the CDSP system will reject it. The financial institution will receive an error report (RT 801) with an error code indicating the reason. The financial institution must correct the error and resubmit the transaction.

13.3.3 How to resolve SIN-related errors

A common reason for a rejected transaction is an error related to the SIN.

When an RDSP is opened, the financial institution submits the beneficiary's and the holder's SIN information electronically to ESDC. The holder and beneficiary information is then validated against the information held by the social insurance registry (SIR), to confirm the following elements:

• SIN
• given name
• surname
• date of birth (DOB)
• gender

In many cases, name changes, inverted numbers and mistakes in birth dates cause errors during the SIN validation process. If the holder or beneficiary SIN information submitted by the financial institution does not match the information contained at the SIR, the submission will result in an error. This will lead to the transaction being rejected by the CDSP system.

A specific report will be sent to the financial institution, identifying the field(s) in error of the holder or beneficiary:

• SIN
• given name
• surname
• DOB
• gender

The RDSP issuer will have to verify the information provided by the holder and resubmit the data to ESDC after the necessary corrections are made.

Until the beneficiary and holder information is successfully processed by ESDC, the Disability Savings Plan cannot be registered with CRA. Furthermore, any financial transactions, including requests for payments of the grant or the bond, will be reported to the issuer as errors found within the CDSP system. The beneficiary and holder information must pass SIR validation before any financial transactions can be processed.

13.3.4 SIN information for client referral

Clients who wish to verify or update their SIN information can:

• visit the Social Insurance Number website
• contact the SIN by phone at:
  • 1-866-274-6627 (toll-free)
  • 1-800-926-9105 (TTY)

13.4.1 Refusal reasons

If the financial institution receives a transaction processing report (RT 901) with a refusal reason, the financial institution consults the list of refusal reasons to determine why the grant or bond was not paid. Depending on the stated reason, the financial institution may or may not take action.

13.5.1 Correcting a contribution transaction

To correct a contribution transaction, transaction type (TT) 401-01, the financial institution must submit a 401-02 transaction with the corrected information.

The 401-02 transaction must always reference the original financial transaction being corrected by providing the original financial institution's BN and the original financial institution transaction number.

Once the CDSP system matches the original and corrected transactions, the information is updated.

For more information, refer to the ITS.

13.5.2 SIN error correction

If the beneficiary's SIN information submitted by the financial institution does not match the information contained at the SIR, an error will occur. This will result in a submission error by the CDSP system.

A report will be sent to the financial institution, identifying the field in error.

• SIN
• Surname
• Given name
• Gender
• DOB

The financial institution will have to verify the information provided with the holder and resubmit the data (transaction) to ESDC after making the necessary corrections.