More Financial Institutions Offering RDSP’s
The CRA has issued a news release advising that more financial institutions are now offering the Registered Disability Savings Plan (RDSP) to eligible Canadians. Scotiabank, TD Waterhouse will now be offering RDSP's, joining ranks with the other institutions (Bank of Montreal, CIBC and Royal Bank) that currently administer the plans. Link to the full CRA news release by clicking
here.
The Registered Disability Savings Plan (RDSP) may be established for an individual who has a severe and prolonged physical or mental impairment and qualifies for the disability tax credit during the year of establishment, or would have if the restriction for the attendant care amount were disregarded.
Any person eligible to claim the Disability Amount can be the beneficiary of an RDSP and the plan can be established by them or by an authorized representative. Anyone can contribute to an RDSP ñ they need not be a family member.
Contributions are not deductible. Income accumulates in an RDSP tax free. Contributions withdrawn from an RDSP are not taxable, but all other amounts ñ accumulated investment income, grants and bonds (discussed below) ñ are taxable in the hands of the beneficiary as withdrawn.
There is no annual limit on contributions but lifetime contributions cannot exceed $200,000. Contributions are permitted until the end of the year in which the disabled beneficiary turns 59.
For more detail about withdrawal requirements and the Canada Disability Savings Grant and Bond, consult: EverGreen Explanatory Notes: Your online gateway to the latest changes at the Department of Finance and CRA. This topic is covered in detail here.
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