If you lose Disability Tax Credit approval

On this page

• When the beneficiary does not have DTC approval
• Making withdrawals without DTC approval
• If the beneficiary regains DTC approval

When the beneficiary does not have DTC approval

Since 2021, if a beneficiary is no longer approved for the Disability Tax Credit (DTC), the holder of their RDSP has the option of closing the plan, or keeping it open.

If the holder decides to keep it open, money can still be withdrawn from the plan, but:

• contributions are not allowed
• grants or bonds cannot be paid
• amounts from a deceased parent or grandparent’s registered retirement savings can only be rolled over into the plan within 4 years after the year in which the beneficiary loses DTC approval

You do not have to repay the grants and bonds that are in the plan solely due to the loss of DTC approval.

Making withdrawals without DTC approval

Money from the plan can still be withdrawn at the request of the holder. Prior to the year the beneficiary turns 60, withdrawals will result in the repayment of grants and bonds that were paid into the RDSP in the 10 years before the beneficiary lost DTC approval.

If the beneficiary regains DTC approval

If the beneficiary regains DTC approval, the plan will operate normally and contributions can be made.