RDSP Guide Canada 2026

What Is the RDSP?

The Registered Disability Savings Plan (RDSP) is a long-term savings plan designed to help Canadians with disabilities and their families save for the future. Contributions are not tax-deductible, but the investment grows tax-deferred inside the account. Withdrawals (called Disability Assistance Payments or DAPs) are taxable to the beneficiary — typically at a lower rate since the beneficiary is the disabled person.

The most powerful feature of the RDSP is the federal government grants and bonds that supplement private contributions — potentially adding thousands of dollars per year in free government money.

Canada Disability Savings Grant (CDSG) — 2026

The CDSG matches RDSP contributions at rates that depend on family net income and contribution amount:

The CDSG is available until the end of the calendar year the beneficiary turns 49. The lifetime CDSG limit is $70,000. To maximize annual grants, contribute $1,500/year when family income is below the threshold (getting $3,500 in grants on $1,500 contributed — a 233% instant return).

Canada Disability Savings Bond (CDSB) — 2026

The CDSB provides up to $1,000/year to low and modest income RDSP beneficiaries — with no contribution required. The bond is purely based on family income:

The lifetime CDSB limit is $20,000. Low-income families who cannot contribute to the RDSP should still open the account — the CDSB is free money that requires only an open RDSP, not a contribution.

The 10-Year Holdback Rule

The RDSP holdback rule is one of the most critical and least understood aspects of the account. If the beneficiary withdraws DAPs in the 10 years following any CDSG or CDSB payment, those grants/bonds must be repaid to the government. Specifically:

• For every $1 withdrawn as a DAP, $3 of the most recently received government grants and bonds must be repaid
• This 3-for-1 repayment is called the "assistance holdback amount"
• The holdback applies to grants/bonds received in the 10 years before the withdrawal

Disability Assistance Payments (DAPs)

Starting at age 60, beneficiaries must begin taking Lifetime Disability Assistance Payments (LDAPs) — similar to RRIF minimums. Before age 60, other DAPs can be made but trigger the holdback rules. LDAPs must continue annually and are calculated based on a formula involving the fair market value of the RDSP and a factor based on the beneficiary's expected lifetime.

AHA Provisions: Accessing RDSP Early for Shortened Life Expectancy

The "Achieving a Better Life Experience" (AHA) provisions allow beneficiaries with a life expectancy of 5 years or less to withdraw up to $100 per year from their RDSP without triggering full holdback repayment. To qualify, a physician or nurse practitioner must certify that the beneficiary's life expectancy is 5 years or less. This provision was made permanent in recent years and is available federally regardless of province.

RDSP and the DTC (Disability Tax Credit)

RDSP eligibility requires the beneficiary to be approved for the Disability Tax Credit (DTC). The DTC application (Form T2201) must be submitted and approved by the CRA before an RDSP can be opened. The DTC approval must be maintained for the RDSP to remain open and to receive government grants/bonds. If DTC eligibility is lost, the RDSP must be closed within 5 years (unless re-qualified).