Plain meaning
A registered savings plan designed to support the long-term financial security of a person eligible for the Disability Tax Credit.
Key points
- The beneficiary generally must be eligible for the Disability Tax Credit when the plan is opened.
- Contributions are not deductible, but investment income can grow tax-deferred inside the plan.
- Federal grants and bonds may be available, subject to age, income, contribution, and lifetime-limit rules.
- Withdrawals can have taxable and non-taxable components depending on the source of funds.
- Loss of DTC eligibility, beneficiary age, and repayment rules can affect planning.
Why it comes up
RDSP rules connect disability eligibility, family savings, federal grants and bonds, long-term planning, and benefit policy.