The impact of RDSPs on government benefits and assistance
Registered Disability Savings Plans (RDSPs) are a type of savings plan for individuals with disabilities in Canada. RDSPs are designed to help individuals with disabilities and their families save for the future and provide financial support for the person with a disability.
While RDSPs can be a valuable tool for saving and supporting individuals with disabilities, they can also have an impact on government benefits and assistance.
One way that RDSPs can impact government benefits and assistance is by affecting the eligibility for certain programs.
For example, the Canadian government provides the Disability Tax Credit (DTC) to individuals with disabilities who meet certain eligibility criteria. To be eligible for the DTC, an individual's RDSP cannot have more than $200,000 in assets. If the RDSP exceeds this limit, the individual may no longer be eligible for the DTC.
Additionally, the amount of government benefits and assistance an individual with a disability receives can be affected by the income and contributions to their RDSP.
For example, some government programs, such as the Canada Child Benefit and the Goods and Services Tax/Harmonized Sales Tax Credit, are based on an individual's income. If the income from an RDSP is included in the calculation of these benefits, it may result in a reduction in the amount of benefits the individual receives.
It's important to note that while RDSPs can have an impact on government benefits and assistance, they can also provide valuable support for individuals with disabilities and their families.
RDSPs can help individuals save for the future and provide financial support for the person with a disability, which can help improve their quality of life.
In conclusion, while RDSPs can have an impact on government benefits and assistance, they can also provide valuable support for individuals with disabilities and their families.
It's important for individuals with disabilities and their families to carefully consider the potential impact of RDSPs on government benefits and assistance when deciding whether this savings plan is right for them.