What Happens If The Beneficiary Becomes Ineligible?

If the Beneficiary loses his/her eligibility for the Disability Tax Credit, or his/her eligibility expires and is not renewed, the RDSP is collapsed and:

  • The RDSP must be closed by the end of the following calendar year
  • The holdback amount (any Grants or Bonds received within the previous 10 years) must be repaid to the government
  • The remainder is paid to the Beneficiary and taxable in the year received
  • The private contributions component is not taxable.

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