3 jars of coins with labels on them.

If you have a Registered Disability Savings Plan (RDSP), know somebody who does, or are thinking about opening one, you may already be familiar with the contribution limits for the RDSP. 

Every RDSP can receive up to $200,000 in personal contributions, $70,000 in grants, $20,000 in bonds, and any amount of interest growth within the account. 

What you may not have realized is that if a withdrawal is made from the RDSP that these limits do not reset. Once a deposit is made into the account, either personal or government, this reduces the total amount that can be deposited in the future. 

Let’s break it down with some examples:

  • You deposit $100,000 into an RDSP through personal contributions. Then you decide that you would like to withdraw $50,000. Even though your RDSP now has only $50,000 of personal contributions, you will still only be able to deposit another $100,000. This is because you have already used up half of that contribution room. 
  • You receive $10,000 in grants and $5,000 in bonds. Then you make an early withdrawal within 10 years of receiving those government funds of $5,000, causing a repayment of the full grant and bond amount. You are now only able to receive $60,000 in grants and $15,000 in bonds in the future 

There are currently no exceptions to these rules and we encourage everyone to consult with their financial professional before making any withdrawals from their RDSP. 

If you would like to learn more about the rules of the RDSP, how withdrawals work, or how this may impact your personal situation, we encourage you to call our free Disability Planning Helpline at 1-844-311-7526 or email in at info@rdsp.com.

More resources and information about the RDSP:

 

 

Disclaimer
This is not professional advice: This document and its contents are for informational purposes only and are not legal, tax, investment, financial, medical or other professional advice, and should not be construed as a recommendation for any particular course of action. Plan Institute is providing the information “as is” and is not responsible or ‎liable for any inaccuracies, errors or omissions in the information, or for the information being incomplete or out of date.‎ You use the information and make decisions and take actions in reliance on the information solely at your own risk, and Plan Institute will not be liable for your use or reliance on any information it provides. You should consult with qualified professional advisors before making any legal, financial, medical or health care decisions.

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