RDSP eligibility: the four conditions, the age limits and who holds the plan

Do you need the Disability Tax Credit before you can open an RDSP?

Yes. Disability Tax Credit approval is the gate, and it stops more people than any other rule. The Canada Revenue Agency describes the RDSP as a savings plan for a person approved to receive the disability tax credit. Until CRA approves the DTC, no financial institution in Canada can open the plan.

That single dependency changes the order of everything. If you are not DTC approved yet, a bank appointment is premature. The DTC application is your real first step, and the rest of this page describes what happens after you clear that gate.

The application is Form T2201, the Disability Tax Credit Certificate. It comes in two parts. You or your legal representative complete Part A. A medical practitioner completes Part B and certifies a severe and prolonged impairment in physical or mental functions. CRA requires both parts in the same format, either the digital form or the paper form. Mixing the two stops the file.

There is a second reason to start here. Once CRA approves you, you can ask it to adjust earlier returns, and the disability amount is listed for the past 10 years. An approval often produces a tax refund before the RDSP holds a single dollar. You can estimate that amount with our free DTC refund calculator. If you want the background on the credit itself, start with our guide to the Disability Tax Credit.

What are the four RDSP eligibility conditions?

CRA sets four conditions for the person who will be the beneficiary. They must be approved for the DTC, hold a valid Social Insurance Number, be a resident of Canada when the plan is entered into, and be under 60. All four have to be true at the same moment. Three out of four opens nothing.

Residency carries a detail that people miss. The beneficiary must be a resident of Canada when the plan is opened and again each time a contribution is made. The holder does not have to live in Canada. So a parent working abroad can still hold a plan for a beneficiary living here.

One more limit sits underneath these four. A beneficiary can hold only one RDSP at a time. That plan can have several holders over its life, and more than one at once, but there is never a second plan running alongside it.

Is there an age limit for opening an RDSP?

Yes. You can open an RDSP until December 31 of the year the beneficiary turns 59. After that date the plan cannot be opened at all. CRA notes that this age limit does not apply when a plan is opened because of a transfer from an earlier RDSP for the same beneficiary.

The deadline that costs people the most money is not 59. It is 49. Grants and bonds can be paid into a plan only until December 31 of the year the beneficiary turns 49. Open a plan at 52 and it still shelters growth from tax, but the federal matching is gone.

At the other end, withdrawals have a start deadline rather than a start age. Lifetime disability assistance payments must begin by the end of the year the beneficiary turns 60, and once started they are paid at least once a year.

Who is the RDSP beneficiary and who can be the holder?

The beneficiary is the person approved for the DTC, and the money in the plan belongs to them. The holder is the person or organization that opens the plan and makes decisions about it. They are often the same person. Every plan has one beneficiary and may have more than one holder.

Who can hold the plan depends on the beneficiary situation, and the rules are specific. For a beneficiary under the age of majority, CRA allows a legal parent, a guardian or tutor or another individual legally authorized to act, or a public department, agency or institution to open the plan and become holder. The age of majority is 18 or 19 depending on the province or territory.

If you are an adult who can enter into a contract, the plan is yours to hold. ESDC is direct about it: an adult beneficiary who does not need a legal representative must be the holder of their own plan. A parent cannot hold it for you by preference. If your parents already held a plan for you before you reached the age of majority, they can stay on, and you can be added as a joint holder.

Where an adult beneficiary contractual competence to enter into a plan is in doubt, a legal representative appointed under provincial law holds the plan. If no legal representative exists, a qualifying family member can open the plan instead. ESDC lists a spouse, common-law partner, parent or adult sibling. The issuer forms that opinion after reasonable inquiry, not a court.

This route has an expiry. CRA states the qualifying family member measure applies as of June 29, 2012 and ends on December 31, 2026. It has been extended more than once, so check the current status before you rely on it. My view for a family in this position: if the qualifying family member route fits you, use it now rather than waiting on a guardianship process that may take longer than the window.

Holders are not permanent. If competence is later established, the beneficiary can replace a qualifying family member as holder on written request. If a legal representative is appointed later, that person replaces the qualifying family member.

How do you open an RDSP?

You open an RDSP with a financial organization that offers the plan, called an issuer. ESDC publishes a list of participating banks, credit unions and investment firms. You do not need an existing account with any of them. The issuer registers the plan with CRA and applies for the grant and bond with you.

The order matters. Get DTC approval first, then confirm the SIN for both the beneficiary and the holder, then choose an issuer from the ESDC list. Apply for the grant and bond at the same appointment where you open the plan, not later. Waiting a year costs a year of matching that you cannot recover after the beneficiary turns 49.

If you already hold DTC approval and want to skip the branch visit, you can open an RDSP online with us.

What is the RDSP application form?

There is no single RDSP application form you file with CRA yourself. Opening a plan involves three separate pieces of paper. Form T2201 establishes the DTC. The issuer plan documents create the RDSP. Form EMP5608 applies for the federal grant and bond. The issuer submits the registration to CRA on your behalf.

Form EMP5608 is the Application for Canada Disability Savings Grant and/or Canada Disability Savings Bond, published in the Service Canada forms catalogue. The issuer normally hands it to you when you open the plan. It is a separate step from opening the account, which is exactly why people who open a plan quickly sometimes leave grant money unclaimed.

Be careful with anything that calls itself an official RDSP form outside these three. CRA registers the plan through the issuer, so a form asking you to register a plan directly is not part of the federal process.

What happens if DTC approval ends?

DTC approval can run out or be denied on renewal. Since 2021, when a beneficiary is no longer approved, the holder chooses to close the plan or keep it open. Grants and bonds already received are not repaid solely because the beneficiary lost DTC approval. That is a meaningful protection.

If the plan stays open, it operates in a reduced way. No new contributions are allowed. No new grants or bonds are paid. Withdrawals are still possible, but before the year the beneficiary turns 60 a withdrawal triggers repayment of grants and bonds paid into the plan in the 10 years before the DTC approval was lost.

If the beneficiary regains DTC approval, the plan returns to normal and contributions can resume. So a lapse is a pause rather than an ending, and the practical response is usually to reapply for the DTC rather than close the plan in a hurry.

Which first step fits your situation?

Most people arrive at this page in one of four situations, and only one of them starts at a bank. If you are not DTC approved, no amount of RDSP research moves you forward. Find your row, then take the step in the third column.

One caution on figures. Grant and bond amounts depend on adjusted family net income, and CRA indexes those income thresholds every year. Check the CRA grant and bond page for the current year amounts rather than a number you read somewhere last year.