Withdraw Savings from a Registered Disability Savings Plan

The Registered Disability Savings Plan (RDSP) is a long-term savings plan. The Grant and Bond are intended to encourage savings and should remain in an RDSP for at least 10 years.

Whenever money is withdrawn from an RDSP, all or part of the grants and the bonds that have been in the RDSP for fewer than 10 years must be repaid to the Government. You must repay $3 for every $1 that is taken out, up to the total amount of grants and bonds paid into the RDSP in the last 10 years. Repayments to the Government of Canada will be applied starting with the oldest grants and bonds paid into the plan first, and then towards the newest.

For information on withdrawing money from an RDSP, see What types of payments are made from an RDSP? or call 1-800-959-8281 (TTY users call 1-800-665-0354).

Beneficiaries with shortened life expectancies

The Government of Canada offers flexibility to people with shortened life expectancies (a life expectancy of five years or less) when making withdrawals from their RDSPs.

Beneficiaries with a life expectancy of five years or less will be able to withdraw up to $10,000 per year in taxable savings, subject to certain conditions. This amount includes grants, bonds and earnings. In addition, beneficiaries can withdraw a pro-rated amount of their plan contributions.

Repayment of any remaining grants and bonds paid into the plan within the preceding 10 years is not required until the death of the beneficiary.

To take advantage of this measure, the plan holder(s) must submit a request to the financial organization, along with a medical attestation. The financial organization will then notify Employment and Social Development Canada of the change to the plan.

For more information on this provision, contact your financial organization or visit the Canada Revenue Agency.

Closure of an RDSP

Grants and Bonds in the RDSP for less than 10 years, or the fair market value of the RDSP, whichever is the lesser, must be repaid to the Government if:

  • the plan is closed;
  • the beneficiary loses eligibility for the Disability Tax Credit; or
  • the beneficiary passes away.

For more information about losing eligibility for the Disability Tax Credit and how this affects your RDSP, see Cessation of disability or death of a beneficiary or call 1-800-959-8281 (TTY users call 1-800-665-0354).

All other money in the RDSP, including private contributions, investment income earned, and grants and bonds in the RDSP for more than 10 years, is paid to the beneficiary or the beneficiary's estate.

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