The Canada Disability Savings Grant is an amount paid based on contributions deposited into an RDSP.
If the beneficiary’s annual family income is less than or equal to $87,123 for 2013, the Government of Canada pays:
- a 300% Grant on the first $500 in annual contributions made to an RDSP and
- a 200% Grant on the next $1000 in annual contributions.
If the beneficiary’s annual family income exceeds $87,123 for 2013, the Government of Canada pays:
- a 100% Grant on the first $1,000 in annual contributions made to an RDSP.
To receive the Grant:
- a contribution must be made to the RDSP;
- the holder must fill out an application form;
- the Grant request must be made by December 31st of the year the beneficiary turns 49;
- the beneficiary must be eligible for a Disability Tax Credit (DTC);
- the beneficiary must be a Canadian resident and have a valid Social Insurance Number (SIN).
To receive 300% on the first $500 and 200% on the next $1,000 in contributions made annually to an RDSP, the beneficiary must:
- have a family income less than or equal to $87,123 if 18 years of age or older;
or - be a dependent of an eligible individual whose income (used to determine the amount of the Canada Child Tax Benefit (CCTB) is less than or equal to $87,123;
or - be a person in respect of whom a special allowance under the Children’s Special Allowances Act is paid for at least 1 month in the year.
To receive 100% on the first $1000 made in contributions during the year:
- the beneficiary’s annual family income exceeds $87,123;
or - no family income information is available from Canada Revenue Agency (CRA).
The Canada Disability Savings Bond is an amount of up to $1000 paid into an RDSP for a low-income beneficiary.
No contribution is needed to attract the Bond.
To receive the Bond:
- the request must be made by December 31st of the year the beneficiary turns 49;
- the holder must fill out an application form;
- the beneficiary must be eligible for a DTC;
- the beneficiary must be a Canadian resident and have a valid SIN.
A beneficiary whose family income is:
- less than or equal to $25,356 for 2013 receives a Bond of up to $1000;
- between $25,356 and $43,561 for 2013 receives a Bond based on a legislative formula;
- more than $43,561 receives no Bond;
A beneficiary whose family income is not available from CRA receives no Bond.
A beneficiary in respect of whom a special allowance under the Children’s Special Allowances Act is to be paid for at least 1 month in the year receives a Bond of $1000.
Transfers
In order for a transfer to occur :
- the transfer must be for the same beneficiary;
- all funds must be transferred;
- the prior plan must be closed;
- all information must be transferred to the new Issuer; and
- the new issuer must continue to pay DAP and LDAP.
Unused Grant and Bond entitlements will be claimed from the past 10 years (starting from 2008).
In order to access Grant and Bond carry-forward entitlements, the beneficiary must:
- be eligible for a DTC;
- be a Canadian resident and have a valid SIN;
- not be older than 49 at the time of applying; and
- not have more than $200,000 in contributions in the plan.
Annual and Lifetime Limits:
The lifetime RDSP contribution limit is $200,000;
The maximum Grant payable for a beneficiary’s lifetime is $70,000;
The maximum Grant payable in a year is $3,500 ($10,500 if it includes carry-forward);
The maximum Bond payable for a beneficiary’s lifetime is $20,000;
The maximum Bond payable in a year is $1,000 ($11,000 if it includes carry-forward).
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For more information on these 2013 income thresholds, see the federal government website: www.disabilitysavings.gc.ca