1. What is an RDSP?
A Registered Disability Savings Plan (RDSP) is a registered long-term savings plan intended to help a person approved for the federal Disability Tax Credit (DTC) save for long-term financial security. Contributions are not tax deductible. Investment income and government incentives accumulate on a tax-sheltered basis while they remain in the plan, but the taxable portions of withdrawals are generally included in the beneficiary's income when paid.
Key Framework Highlights:
- An eligible beneficiary generally must be a Canadian resident, have a valid Social Insurance Number (SIN), be approved for the DTC and be under age 60 when the plan is opened.
- An RDSP can generally be opened through December 31 of the year in which the beneficiary turns 59.
- Grants and bonds are payable only through December 31 of the year in which the beneficiary turns 49.
- The lifetime contribution limit is $200,000. There is no annual contribution limit, subject to the lifetime limit and the other RDSP rules.
- Contributions are not deductible from income.
- The beneficiary can have only one RDSP at a time.
Action Checklist:
- Confirm DTC eligibility and Canadian residency.
- Confirm the beneficiary has a valid SIN.
- Choose a participating financial institution that offers RDSPs.
- Open the plan and apply for the CDSG and CDSB.
- Keep the beneficiary's tax returns current so family-income-based entitlements can be calculated.
2. 2026 CDSG Grant Rates
For transactions dated January 1, 2026 or later, the CDSG matching rate depends on the beneficiary's adjusted family net income. When adjusted family net income is $117,045 or less, the grant is 300% on the first $500 of contributions and 200% on the next $1,000. When income is above $117,045, the grant is 100% on the first $1,000 of contributions. The maximum current-year CDSG is $3,500 and the lifetime limit is $70,000.
Key Framework Highlights:
- 2026 second threshold: $117,045.
- Maximum regular annual CDSG: $3,500.
- Lifetime CDSG limit: $70,000.
- The income thresholds are indexed and can change from year to year.
- Unused grant entitlements from eligible previous years can be carried forward, subject to the annual catch-up limit.
| 2026 adjusted family net income | Contribution portion | Grant rate | Maximum CDSG from that portion |
|---|---|---|---|
| $117,045 or less | First $500 | 300% | $1,500 |
| $117,045 or less | Next $1,000 | 200% | $2,000 |
| $117,045 or less | Total first $1,500 | 300% then 200% | $3,500 total current-year CDSG |
| More than $117,045 | First $1,000 | 100% | $1,000 |
3. 2026 CDSB Bond Rules and Income Thresholds
The Canada Disability Savings Bond (CDSB) is government money paid directly into an eligible RDSP. No personal contribution is required to receive a bond. For 2026, adjusted family net income of $38,237 or less can qualify for the maximum $1,000 annual bond, while income between $38,237 and $58,523 can qualify for a partial bond under the statutory formula. Above $58,523, no 2026 CDSB is payable under the regular income test.
Key Framework Highlights:
- Lifetime CDSB limit: $20,000.
- No personal contribution is required for a qualifying CDSB payment.
- Bonds are payable only through December 31 of the year the beneficiary turns 49.
- Carry-forward bond entitlements can allow up to $11,000 of CDSB to be paid in a year, subject to the beneficiary's actual unused entitlements.
| 2026 adjusted family net income | CDSB treatment | Annual amount |
|---|---|---|
| $38,237 or less | Maximum bond | Up to $1,000 |
| More than $38,237 and up to $58,523 | Partial bond under the statutory income formula | More than $0 and up to $1,000 |
| More than $58,523 | No regular CDSB | $0 |
4. What counts as family income for RDSP purposes?
The income used for the CDSG and CDSB calculations depends on the beneficiary's age. For beneficiaries age 19 or older, family income generally means the beneficiary's net income plus the net income of the beneficiary's spouse or common-law partner. For beneficiaries under 19, the calculation generally uses the income of the beneficiary's parent or legal guardian under the applicable rules. Because the program generally relies on tax-return information from two years earlier, keeping returns filed is important.
| Beneficiary age | Income basis generally used | Practical implication |
|---|---|---|
| Under 19 | Parent or legal guardian income under the applicable rules | The family income of the adult responsible for the child is used for the grant and bond calculation. |
| 19 or older | Beneficiary's net income plus spouse/common-law partner's net income | The beneficiary should keep their own tax return current and include applicable spouse/common-law partner information. |
5. The 10-Year Carry-Forward Rule
An RDSP can use unused CDSG and CDSB entitlements from eligible previous years, generally covering up to the previous 10 years. The carry-forward is not unlimited: the beneficiary must have met the relevant eligibility requirements in the years for which the entitlement is claimed, including DTC and residency requirements where applicable. Catch-up payments are subject to annual maximums of $10,500 for CDSG and $11,000 for CDSB.
Key Framework Highlights:
- Unused entitlements can generally be carried forward for up to 10 previous years.
- Maximum CDSG payable in a year when using carry-forward: $10,500.
- Maximum CDSB payable in a year when using carry-forward: $11,000.
- The carry-forward does not create new entitlement for years in which the beneficiary was not eligible.
- Carry-forward entitlements are calculated automatically; the holder does not normally submit a separate manual calculation.
6. How much should you contribute to maximize a regular 2026 CDSG?
For a beneficiary whose 2026 adjusted family net income is $117,045 or less and who has enough current-year grant room, a $1,500 contribution can generate the maximum regular $3,500 CDSG for that year: $500 at 300% produces $1,500 of grant and the next $1,000 at 200% produces another $2,000. A beneficiary above the $117,045 threshold can receive up to $1,000 of current-year CDSG from a $1,000 contribution. Carry-forward entitlements can change the contribution strategy because older unused grant room may be available at different rates.
| 2026 situation | Contribution | Grant generated | Total government amount |
|---|---|---|---|
| Income $117,045 or less, no unused grant needed | $500 | $1,500 | $2,000 including contribution |
| Income $117,045 or less, no unused grant needed | $1,500 | $3,500 | $5,000 including contribution |
| Income above $117,045, no unused grant needed | $1,000 | $1,000 | $2,000 including contribution |
7. Contributions, tax treatment and the $200,000 lifetime limit
RDSP contributions are not deductible. The beneficiary is generally not taxed when original personal contributions are withdrawn. By contrast, grants, bonds, investment income and eligible rollover proceeds are generally included in the beneficiary's income when paid out. Contributions, including eligible rollover amounts that count toward the limit, cannot exceed $200,000 over the beneficiary's RDSP history.
Key Framework Highlights:
- Lifetime contribution limit: $200,000.
- No annual contribution limit, subject to the lifetime limit and RDSP eligibility rules.
- Personal contributions are not tax deductible.
- Original personal contributions are generally not included in the beneficiary's income when withdrawn.
- Grants, bonds, investment earnings and qualifying rollover proceeds are generally taxable to the beneficiary when paid out.
- A grant is not paid merely because an amount was rolled over into the RDSP; eligible rollover amounts do not receive matching CDSG.
8. Withdrawals and the 3-for-1 proportional repayment rule
Withdrawals from an RDSP are generally made as disability assistance payments (DAPs), with lifetime disability assistance payments (LDAPs) being recurring DAPs that must begin by the end of the year the beneficiary turns 60. For qualifying withdrawals made under the ordinary rules, the proportional repayment mechanism can require repayment of $3 of grant and bond assistance for each $1 withdrawn, up to the assistance holdback amount. The assistance holdback amount is based on grants and bonds paid into the plan during the preceding 10 years, less applicable repayments.
Key Framework Highlights:
- The 3-for-1 calculation is not an unlimited clawback; it is capped by the assistance holdback amount.
- The proportional repayment rule applies to DAPs and LDAPs.
- The assistance holdback amount is based on recent grants and bonds, not every grant or bond ever received.
- Grants and bonds that have been in the plan longer than the applicable 10-year period are generally not part of the assistance holdback amount for an ordinary withdrawal.
- Separate full-repayment rules can apply when an RDSP is closed, deregistered or the beneficiary dies.
9. Specified Disability Savings Plan (SDSP) exception
A specified disability savings plan is available in qualifying circumstances where a medical doctor or nurse practitioner certifies that the beneficiary is unlikely to survive more than five years. If the holder makes the prescribed election and the required notification is made, qualifying withdrawals can be made without triggering repayment of the assistance holdback amount, subject to the SDSP rules. The SDSP election has important trade-offs: generally, no further contributions can be made and no new grants or bonds can be paid while the plan has SDSP status.
Key Framework Highlights:
- A licensed medical doctor or nurse practitioner must provide the required certification.
- The holder must make the prescribed SDSP election with the RDSP issuer.
- The ordinary $3-for-$1 assistance holdback repayment rule is modified for qualifying SDSP withdrawals.
- The taxable portion of SDSP withdrawals is generally subject to the RDSP income-tax rules.
- Making the SDSP election can stop further contributions and new grant or bond payments.
10. What if the beneficiary loses DTC eligibility?
Loss of DTC eligibility does not necessarily mean the RDSP must immediately close. Under the federal RDSP rules, an RDSP can remain open in the circumstances provided by the legislation, but while the beneficiary is no longer DTC-eligible, new contributions, grants and bonds generally stop. There are special election and closure rules, including a five-year period in which DTC eligibility may be restored in the applicable circumstances. Repayment consequences can apply to grants and bonds when a plan must be closed following loss of DTC eligibility.
Key Framework Highlights:
- Loss of DTC eligibility does not automatically mean all existing grants and bonds disappear immediately.
- While the beneficiary is not DTC-eligible, new contributions, new grants and new bonds can be restricted under the applicable rules.
- The federal rules provide a mechanism involving a five-year period for certain beneficiaries who have lost DTC eligibility.
- If the beneficiary does not regain DTC eligibility within the applicable period, the plan may have to close and repayment consequences can apply.
- The exact repayment period and closure date depend on the statutory circumstances of the individual case.
11. RDSP retirement and education plan rollovers
Certain amounts from a deceased parent or grandparent's registered retirement or pension arrangements can be transferred on a tax-deferred basis to an eligible financially dependent beneficiary's RDSP when the statutory conditions are met. Eligible education savings amounts can also be rolled from an RESP into an RDSP in qualifying circumstances. A rollover does not receive a matching CDSG and rollover amounts count toward the $200,000 lifetime contribution limit.
| Rollover source | Can it be eligible? | Key condition | Grant on rollover? |
|---|---|---|---|
| Deceased parent or grandparent's RRSP proceeds | Yes, where statutory conditions are met | Beneficiary generally must be financially dependent because of a physical or mental impairment and satisfy the RDSP rollover rules | No |
| Deceased parent or grandparent's RRIF proceeds | Yes, where statutory conditions are met | Same general financial-dependency and statutory rollover framework | No |
| Certain RPP, SPP or PRPP lump sums | Yes, where statutory conditions are met | Must be an eligible amount under the RDSP rollover rules | No |
| Qualifying RESP amount | Yes, in qualifying circumstances | Must meet the applicable education-savings rollover conditions | No |
12. Opening an RDSP: practical roadmap
An RDSP is opened through a participating financial institution. The financial institution completes the plan-opening process, and the holder can apply for the CDSG and CDSB. Current tax information is important because the government uses income information to determine grant and bond amounts.
Action Checklist:
- Confirm the beneficiary is a Canadian resident and has a valid SIN.
- Confirm DTC approval, or verify whether a permitted transfer exception applies.
- Check the beneficiary's age and the deadline for opening an RDSP.
- Choose a financial institution that offers RDSPs.
- Open the RDSP and identify the plan holder.
- Apply for the CDSG and CDSB.
- Check the Statement of Entitlement and available carry-forward amounts.
- File missing or current tax returns so the program can calculate family income.
- Plan contributions around the available current-year and carry-forward grant entitlements rather than assuming that any contribution receives the same matching rate.
13. 2026 worked scenarios
| Scenario | Contribution | Government incentive | Result |
|---|---|---|---|
| 2026 income at or below $117,045, sufficient current-year grant room | $1,500 | $3,500 CDSG | Maximum regular 2026 CDSG is generated |
| 2026 income above $117,045, no carry-forward used | $1,000 | $1,000 CDSG | Maximum current-year CDSG at the 100% rate |
| 2026 low/modest income, eligible for maximum CDSB | $0 | $1,000 CDSB | Bond can be paid without a personal contribution |
| Eligible beneficiary with sufficient unused carry-forward | Contribution amount depends on grant room | Up to $10,500 CDSG in one year | Catch-up can be much larger than the ordinary $3,500 annual CDSG |
| Eligible beneficiary with sufficient unused bond entitlement | $0 | Up to $11,000 CDSB in one year | Carry-forward bonds do not require personal contributions |
| Withdrawal while recent grants/bonds remain in holdback period | DAP or LDAP requested | Possible proportional repayment | Up to $3 of recent grant/bond assistance per $1 withdrawn, capped by the assistance holdback amount |
14. 2026 RDSP decision framework
Action Checklist:
- Need to open an RDSP? Verify Canadian residency, SIN, DTC status and the age-59 opening deadline.
- Want the maximum regular CDSG in 2026? For income of $117,045 or less and sufficient current-year entitlement, $1,500 of contributions can generate $3,500 of CDSG.
- Have low or modest family income? Check the 2026 CDSB thresholds of $38,237 and $58,523; no contribution is required for a bond.
- Have missed prior years? Check up to 10 years of unused eligible grant and bond entitlements.
- Have large carry-forward grant room? Check the $10,500 annual CDSG catch-up ceiling before deciding how much to contribute.
- Considering a withdrawal? First determine the assistance holdback amount and whether the payment will trigger proportional repayment.
- Have a life expectancy of five years or less? Ask the financial institution about the SDSP election before withdrawing.
- Lost DTC approval? Review the special RDSP rules before closing the plan or making any distribution.
- Considering an inheritance or retirement-plan transfer? Check whether a qualifying RRSP/RRIF/pension/RESP rollover is available and remember that rollovers do not earn matching grants.
Frequently Asked Questions
Official Government & CRA References
- Canada.ca — Canada Disability Savings Grant and Canada Disability Savings Bond
- Canada.ca — 2026 RDSP income matching rates
- Canada.ca — Who can open a plan and apply for grants and bonds
- Canada.ca — Make contributions and watch savings grow
- Canada.ca — How much you could get in grants and bonds
- Canada.ca — Withdraw money from your plan
- Canada.ca — What is a specified disability savings plan (SDSP)
- Canada.ca — What is an RDSP?
- Canada.ca — Registered Disability Savings Plan RC4460
- Canada.ca — IC99-1R4 Registered Disability Savings Plans
- Canada.ca — Tax payable on RDSP payments
- Canada.ca — How payments from an RDSP are reported
RDSP Key Metrics for 2026
- Lifetime CDSG limit$70,000 per beneficiary
- Lifetime CDSB limit$20,000 per beneficiary
- Maximum current-year CDSG$3,500
- Lifetime contributions$200,000
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