RDSP (Registered Disability Savings Plan)

Who can open an RDSP

An RDSP can be opened for anyone who has been approved for the Disability Tax Credit (DTC), has a Social Insurance Number, is a resident of Canada, and is young enough: the plan must be opened by the end of the year the beneficiary turns 59. The beneficiary is the person with the disability. The holder, who opens and manages the plan, can be the beneficiary themselves, a parent, or a legal representative. The plan is opened at a participating financial institution, and only one RDSP can exist per beneficiary at a time.

DTC approval is the gate to everything on this page. If you or your child might qualify and have never applied, that one application unlocks not just a tax credit but the entire RDSP program, including tens of thousands of dollars of potential government deposits.

Contributions: no deduction, almost no limits

RDSP contributions work differently from an RRSP. They are not tax deductible, and there is no annual limit, only a lifetime cap of $200,000 per beneficiary (as of July 2026). There is no contribution room to earn or track, and anyone can contribute with the holder's written permission, so grandparents, siblings and friends can put money in directly.

Contributions are allowed until the end of the year the beneficiary turns 59. Inside the plan, contributions, grants, bonds and investment growth all compound tax-deferred until money is withdrawn. Few families ever approach the $200,000 cap; for most, the right yearly target is simply the amount that captures every available grant dollar.

The grant: up to 300% matching

The Canada Disability Savings Grant (CDSG) is why the RDSP routinely beats every other account for eligible savers. The government matches contributions at a rate that depends on adjusted family net income, and at the lower income tier the match reaches 300%.

At the lower tier, a $1,500 contribution attracts the full $3,500 annual grant: $3 for every $1 on the first $500, then $2 for every $1 on the next $1,000. That is an instant 233% return before any investment growth. Grants are paid until the end of the year the beneficiary turns 49, up to a lifetime maximum of $70,000.

One detail that surprises families: starting in the year the beneficiary turns 19, it is the beneficiary's own family income that counts, not their parents'. Many adult beneficiaries with modest incomes land in the generous tier even if their parents never did. Income for a given year is measured from tax returns filed two years earlier, so file a return every year, even with zero income, or grants and bonds can be delayed or shortchanged.

The bond: free money, no contribution required

The Canada Disability Savings Bond (CDSB) requires no contribution at all. If family net income is $35,000 or less (as of July 2026), the government deposits the full $1,000 for the year simply because the plan exists. The bond shrinks gradually above that threshold and reaches zero at $53,359. The lifetime maximum is $20,000, and like the grant, bonds are paid until the end of the year the beneficiary turns 49. Payment is automatic once the plan exists: the government checks income each year and deposits whatever the beneficiary qualifies for.

This is the single most important sentence on this page: open the RDSP even if you cannot afford to deposit a single dollar. A low-income beneficiary who opens a plan and never contributes can still collect up to $20,000 of bonds over time, plus the catch-up amounts described next. Leaving the account unopened is leaving guaranteed money on the table.

Carry-forward: claiming up to 10 years of missed money

Grant and bond entitlements accumulate from 2008, the year the program began, or from the year the beneficiary became DTC-eligible, whichever is later. Unused entitlements from the past 10 years can still be claimed, so opening a plan late can trigger several years of government deposits at once.

Catch-up payments are capped each year: up to $10,500 of grants and up to $11,000 of bonds in a single year (as of July 2026). Catch-up grant matching is applied at the highest available rates first, which makes a large contribution in a catch-up year exceptionally well rewarded.

The 10-year rule: why RDSP money must stay put

Every grant and bond dollar received in the 10 years before a withdrawal sits in the assistance holdback amount. When money comes out of the plan, the government claws back $3 of grants and bonds for every $1 withdrawn, up to that full holdback amount. A $1,000 withdrawal while $20,000 of recent government money is in the window triggers a $3,000 repayment.

The practical conclusion: the RDSP is a long-horizon vehicle. Withdrawals only make sense once the government money has aged out, ideally 10 or more years after the last grant or bond lands. This is why a typical plan stops receiving grants and bonds at 49 and starts paying out around 60, with no repayment at all.

Withdrawals: DAPs and LDAPs

Withdrawals come in two forms: one-time disability assistance payments (DAPs) and recurring lifetime disability assistance payments (LDAPs), which must continue for life once started. LDAPs become mandatory in the year the beneficiary turns 60, with an annual amount set by a formula that spreads the plan value over the beneficiary's remaining life expectancy plus three years.

Taxation is proportional. The slice of each withdrawal representing your own contributions comes out tax-free; the slice representing grants, bonds and investment growth is taxable to the beneficiary, who typically has little other income and often pays little or no tax. Compare that with a RESP, where the same split applies to the student, or a TFSA, where nothing is taxed but nothing is matched: for a DTC-eligible saver with a long horizon, the RDSP's grants and bonds usually dwarf what any other account can offer.