Tax payable on an advantage

Effective after March 22, 2017, if the holder or a person not dealing arm's length with the holder (including the RDSP itself) was provided with an advantage in relation to their RDSP during the year a 100% tax is payable, which is:  

For taxes payable on an advantage before March 23, 2017, you must file using Form RC4532, Individual Tax Return for Registered Disability Savings Plan (RDSP), with a payment for any balance due no later than 90 days after the end of the calendar year.

For taxes payable on an advantage after March 22, 2017, you must file using Form RC339, Individual Return for Certain Taxes for RRSPs, RRIFs, RESPs or RDSPs, with a payment for any balance due no later than June 30 of the year following the end of the calendar year.

Payment of tax

Each person who is a holder of an RDSP is jointly liable for the taxes on prohibited investments, non-qualified investments and advantages described below. Where two or more holders of an RDSP are jointly liable to pay the tax only one, Form RC4532, Individual Tax Return for Registered Disability Savings Plan (RDSP), needs to be filed on behalf of all the holders that are liable for the tax.

For taxes payable on an advantage after March 22, 2017, you must file using Form RC339, Individual Return for Certain Taxes for RRSPs, RRIFs, RESPs or RDSPs, with a payment for any balance due no later than June 30 of the year following the end of the calendar year.

 

Note

When an advantage is extended by the issuer of an RDSP, the issuer, and not the holder, is liable for the tax. If the RDSP issuer is liable for this tax before March 23, 2017, the issuer must file a T3GR, Group Income Tax and Information Return for RRSP, RRIF, RESP, or RDSP Trusts. After March 22, 2017, the issuer must file the RC298, Advantage Tax for RRSP, TFSA, RDSP, or RESP issuers or RRIF carriers with a payment for any balance due no later than June 30 of the year following the end of the calendar year.

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