About RDSPs

Qualifying for an Registered Disability Savings Plan

Any person can be a beneficiary of an RDSP if he/she meets all of the following criteria:

  • Is eligible for the disability tax credit
  • Has a valid social insurance number
  • Is a resident of Canada
  • At the time the plan is entered into, has not and will not have turned 60 by the end of the year, except to transfer in an existing RDSP for the beneficiary

Who can open an RDSP

  • An adult beneficiary can open an RDSP. If an adult beneficiary is not mentally capable, the legal guardian of property of the beneficiary can open the RDSP
  • In the case of a beneficiary who is a minor, a parent, both parents or a legal guardian of property can open and direct the RDSP
  • A beneficiary can only have one RDSP at a time, except when transferring from one RDSP to another. The issuer must transfer the assets or value of the assets to another RDSP of the beneficiary when requested and the transferee plan is to be closed within 120 days of the transferor plan being opened

Contribution rules

  • There is a $200,000 beneficiary lifetime contribution limit but there is no annual limit on contributions
  • Contributions to an RDSP are not deductible for income tax purposes. Investment income (including interest, dividends and realized capital gains) earned in an RDSP will not be taxed in the plan, but will be taxable to the beneficiary, together with government grants and bonds, when paid out
  • Contributions are not allowed after the calendar year in which the beneficiary turns 59