A registered disability savings plan, or RDSP, are savings plans that offer extraordinary benefits for those who qualify for and use them, or even in estate planning and trusts for those with disabled dependents. The RDSP is a federal plan for people with disabilities that provides the following advantages:

–           Tax Free Earnings
–           Government Grants and Bonds
–           Government Incentives

Tax Free Earning

The registered disability savings plan allows any contributions to earn interest tax free until money is withdrawn from the plan. This allows the principal balance to grow and accumulate at a quicker pace, meaning more potential returns and growth. Tax will be deferred until such a time that money needs to be withdrawn from the plan.

Government Grants and Bonds

Another major benefit of RDSPs is the possibility of government grants and bonds which are available. A total of $3500 annually, up to a lifetime maximum of $70 000 is available in grants, and a total of $1000 annually, up to a lifetime maximum of $20 000 is available in bonds. Combined with tax free earnings until withdrawal, these plans can see quick growth and high values.

Government Incentives

The other main advantage of RDSPs is that income withdrawals do not affect eligibility for income-based federal programs such as Old Age Security, Canada Pension Plan and Guaranteed Income Supplement. This allows flexibility to make sure that withdrawing money from the RDSP will not mean the loss of other government income streams.


If a RDSP seems right for you or a loved one, you should consider seeking out tax services to determine how to best set up a RDSP. The quicker you setup the RDSP, the more time it has to see massive returns.