As many of you are probably aware, the amount of Canada Disability Savings Grant and Canada Disability Savings Bond you receive annually is based on your annual income from two years prior. As such, it is very important that you submit a tax return each and every year, even if you do not have any income. By submitting your tax return, you will ensure that you get the full amount of Grant and Bond that you are eligible to receive.
When the federal government assesses what amount of Grant and Bond you are eligible to receive they will look at your annual income for two years prior. Once they verify that you are within a certain income level, they will deposit the corresponding amount of Grant and Bond into your Registered Disability Savings Plan. As a result, it is important to keep track of what the eligible level of incomes are for the Grant and Bond every year. Indexed for inflation, these eligible income levels will change every year.
For 2009, the new family income thresholds for the RDSP Grant and Bond are:
Canada Disability Savings Grant
To be eligible for the full $3,500 annual Grant, which can be received for $1,500 of contribution, your annual family income will need to be less than or equal to $77,664.
If your annual family income is more than $77,664, you are still eligible for the matching Grant of $1,000 per year.
Canada Disability Savings Bond
To be eligible for the full $1,000 annual Bond, which can be received with no contribution, your annual family income will need to be less than or equal to $21,816.
If your family income is between $21,816 and $38,832 in 2009, you can still receive a partial amount of the annual Bond.
** It is important to remember that when the beneficiary is a child, these income thresholds will be based on the family net-adjusted income. As soon as the beneficiary of the RDSP becomes an adult, it will be their personal net-adjusted income which is counted for the purposes of the Grant and Bond. If the beneficiary has a spouse, the income levels will be based on the family net-adjusted income.
** For those of you who were not able to get your tax return done in time for the 2008 deadline, you will still be able to receive the full amount of 2008 Grant and Bond you are entitled too, as long as you set up your RDSP, contributed before March 2, 2009, and eventually file your tax return. Having said this, the longer you wait to file your tax returns, the longer it takes to leverage the full Grant and Bond into your plan, and there will probably be a small loss of investment growth as a result.