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Registered Disability Savings Plan (RDSP)

The Registered Disability Savings Plan (RDSP) is a long-term savings plan backed by the Canadian government, designed to help Canadians with disabilities and their families save for the future. By opening an RDSP, you may be eligible to receive substantial government assistance in the form of grants and bonds, up to a lifetime maximum of $90,000.

Who Qualifies for an RDSP?

To be the beneficiary of an RDSP, you must meet key eligibility criteria set by the Canada Revenue Agency (CRA):

Be a Canadian resident with a valid Social Insurance Number (SIN).
Be approved for the Disability Tax Credit (DTC), which requires a medical practitioner to certify the individual has a severe and prolonged impairment on Form T2201.
Be under age 60 when the plan is opened (i.e., opened until the end of the year you turn 59).

In Canada, the Critical Illness Insurance covers a full benefit payout of 25 critical illnesses for adults and 5 child critical illnesses. In addition there 8 more illnesses that are eligible for a partial payout.

Common Impairment Examples

The document lists many conditions that may qualify as severe and prolonged impairments for the DTC, including (but not limited to):

Physical: Amputation, Hip Injury/Pain, Herniated Disc, Paralysis, Stroke survivors with lasting impairments, Severe functional limitations from Rheumatoid Arthritis.
Cognitive/Mental Health: Alzheimer's Disease, Autism, Intellectual or Developmental Disabilities, Bi-Polar Disorder, Schizophrenia, Anxiety Disorder or Depression (if severely limiting daily activities), PTSD.
Chronic Conditions: Cancer (if impairments due to treatment are prolonged), Chronic Pain/Conditions, Chronic Obstructive Pulmonary Disease (COPD), Crohn's Disease, Cystic Fibrosis, Diabetes (Type 1/Insulin Dependent), Multiple Sclerosis (MS).

Government Financial Assistance: Up to $90,000

The Canadian government provides two key ways to grow your RDSP savings, potentially adding up to $90,000 over the beneficiary's lifetime:

Program	Matching/Free	Lifetime Maximum	Annual Maximum	Contribution Required?	Eligibility Limit
Canada Disability Savings Grant (CDSG)	Matching Grant	$70,000	$3,500	Yes (matches contributions)	End of the year beneficiary turns 49
Canada Disability Savings Bond (CDSB)	Free Money (Bond)	$20,000	$1,000	No (income-tested)	End of the year beneficiary turns 49

Canada Disability Savings Grant (CDSG) Matching Rates

The grant matches contributions based on the beneficiary's adjusted family net income (AFNI). The income threshold for 2025 is $114,750.

Family Net Income (2025)	Contribution to RDSP	Grant Matching Rate	Annual Grant Maximum
Less than or equal to $114,750	First $500 contributed	$3 for every $1 contributed	$1,500
Less than or equal to $114,750	Next $1,000 contributed	$2 for every $1 contributed	$2,000

Canada Disability Savings Bond (CDSB) Rates

The bond is for individuals with low to modest incomes and requires no personal contribution. The bond is based on the beneficiary's AFNI for 2025.

Family Net Income (2025)	Annual Bond Amount
Less than or equal to $37,487 (or if the holder is a public institution)	$1,000
Between $37,487 and $57,375	A portion of $1,000 (decreases as income increases)
Greater than or equal to $57,375	Not eligible for the bond

Note on Carry-Forwards: If you were approved for the DTC in previous years but did not have an RDSP, you can apply to receive up to 10 years of missed Grants and Bonds. You can receive an annual maximum of $10,500 in grants and $11,000 in bonds from these carry-forward entitlements.

Next Steps

If you or a loved one are disabled and a Canadian resident, exploring the RDSP is a critical step toward long-term financial security. Would you like me to find out how to apply for the Disability Tax Credit (DTC) or locate a financial institution that offers the RDSP?

FAQs

Still not sure what to do? Here is a list of our FAQ's; click the question to unveil the answer

What is the Registered Disability Savings Plan (RDSP) and why is it important?

The RDSP is a long-term, tax-deferred savings plan created by the Canadian government to help people with disabilities and their families save for the future. Its main benefit is the generous financial assistance from the government through the Canada Disability Savings Grant (CDSG) and the Canada Disability Savings Bond (CDSB), which can total up to $90,000 over the beneficiary's lifetime.

Who is eligible to be the beneficiary of an RDSP?

To open an RDSP, the individual with the disability (the beneficiary) must meet all of the following criteria:

Be approved for the Disability Tax Credit (DTC) by the CRA (Form T2201).
Have a valid Social Insurance Number (SIN).
Be a resident of Canada when the plan is opened.
Be under age 60 when the plan is opened (i.e., before the end of the year they turn 59).

How do I get approved for the Disability Tax Credit (DTC)?

The DTC is a non-refundable tax credit that is a prerequisite for opening an RDSP. You must complete Form T2201 (Disability Tax Credit Certificate). Part A of the form is completed by the applicant (or legal representative), and Part B must be completed and certified by a medical practitioner (like a doctor, nurse practitioner, or psychologist). The form is then submitted to the CRA for approval.

What is the difference between the Grant and the Bond?

The government offers two types of financial assistance:

Canada Disability Savings Grant (CDSG): This is a matching grant paid into the RDSP when contributions are made. It is based on the beneficiary's adjusted family net income and can match contributions at a rate of 100%, 200%, or 300%. The lifetime limit is $70,000.
Canada Disability Savings Bond (CDSB): This is a bond paid directly into the RDSP for low-income Canadians, and no contributions are required to receive it. The maximum annual amount is $1,000, up to a lifetime limit of $20,000.

Is there a time limit for receiving the Grants and Bonds?

Yes. Government Grants and Bonds can only be paid into an RDSP until the end of the year in which the beneficiary turns 49. However, the plan can be opened and personal contributions can be made until the end of the year the beneficiary turns 59.

What are the rules for withdrawing money from an RDSP?

The RDSP is designed for long-term savings, with payments typically starting when the beneficiary is older.

Withdrawal Age: Mandatory recurring payments, called Lifetime Disability Assistance Payments (LDAPs), must begin by the end of the year the beneficiary turns 60.
Repayment Rule: If money is withdrawn before the beneficiary turns 60, or if the plan is closed, all Grants and Bonds paid into the plan within the previous 10 years must generally be repaid to the government (called the Assistance Holdback Amount). This repayment rule does not apply to personal contributions or investment earnings.
Taxation: Personal contributions are not tax-deductible and are not taxed when withdrawn. However, the Grants, Bonds, and investment earnings are all considered taxable income for the beneficiary when they are withdrawn.

Registered Disability Saving Plan (RDSP)

Unlock Your Future: The Registered Disability Savings Plan (RDSP) in Canada