You are currently browsing the monthly archive for September 2008.

Al Etmanski, Co-Founder and President of PLAN recently blogged on the potential and power of the RDSP to leverage people out of poverty.  Here is a sample from his post:

“Fighting poverty by encouraging savings is now being championed by people inside and outside government around the world.  Experts now acknowledge it is not sufficient to only  provide monthly income support.  They understand that saving and owning financial assets increases the opportunity for economic and social participation.  There are many good books on this topic.  One influential one is ‘Poverty and the Poor” by Michael Sherraden.

The new Registered Disability Savings Plan provides incentives for our sons and daughters to save.  Hundreds of millions of dollars will be transferred from government directly to them.  Combined with our financial support and compound interest this will result in billions of dollars directly available to them.  No agencies, no intermediaries.  This is a path out of poverty toward economic justice.

Some early critics have dismissed the RDSP as a tool for the rich.  They ignore the struggles of middle income parents to provide some semblance of financial security for their loved ones.  These critics also ignore the rich matching program of the Disability Savings Grant for lower income families and individuals and the precedent potential of the Canada Savings Bond. 

Does it go far enough?  Of course not.  But it goes further than any other federal or provincial policy strategy to address the poverty of Canadians with disabilities in decades.

The Expert Panel’s report was called A New Beginning because they understood the RDSP was an important first step. It sets a world class anti poverty strategy in motion. 

It is up to us to move the agenda to the next stage.”

To read the entire post visit:


What are the different parties saying around the issue of disability during the current federal election campaign?  Here’s a brief overview:

Liberal Party

“Among the most sacred of Canadian values is this core belief: the true measure of a country is the way it treats its most vulnerable.  Our platform includes:  making the Disability Tax Credit refundable, ensuring that low-income individuals who are disabled are able to directly benefit from this tax credit.  Changing the CPP disability requirements to ensure that those with episodic illnesses – such as Multiple-sclerosis and some mental illnesses – do not jeopardize their ability to collect CPP or QPP disability benefits if they work when they are able to.”

To read more visit:

New Democratic Party

“On December 13 2006, after four years of negotiations, and with the international participation of civil society and NGOs, the United Nations General Assembly adopted the first international covenant on the rights and dignity of people with disabilities. This covenant fills an important gap in international law, by providing universal legally binding standards which create a global framework for inclusion.

Congratulations to the Canadians with disabilities and to Canadian Disabilities groups who have played a leading role in the drafting of this new international covenant on the rights and dignity of people with disabilities! The Convention shall enter into force in March 2007, once twenty countries have ratified it.

Each country which ratifies the Convention accepts its legal obligations under the treaty and must adopt implementing legislation, and report regularly on its progress.  We all know that the government of Canada should be the first government to officially endorse the Convention.”

To read more visit:

The Green Party

“The Green Party of Canada believes that it is time to treat Canadians with disabilities with dignity. We endorse the Basic Income Programme proposed by the Caledon Institute, which asserts, when all factors are taken into account, will actually save the government money. We urge the adoption of this income security programme for people with disabilities as soon as possible as an interim measure to a full poverty eradication federal-provincial program is established to provide for income security for all Canadians.”  

To read more visit:

Conservative Party

“Today, Prime Minister Stephen Harper announced that a re-elected Conservative Government will introduce important financial changes to benefit families that care for family members with disabilities.  We will:

Allow families to split their income between spouses to reduce their taxes in situations where one spouse is not working full-time in order to care for one or more family members with disabilities – whether children or adults.

Improve the Registered Disability Savings Program by making it easier for a person with disabilities to access money that has been transferred from the unused retirement savings of a deceased family member”.

To read more visit:

As a family member, I welcome Prime Minister Harper’s two election announcements today:

1) To allow the proceeds of RRSPs or RRIFs to be rolled over to the RDSP of a son, daughter or grandchild with a disability, 2) To allow income splitting for families where one spouse is not working full-time as a result of caring for a family member with disabilities. 

More details are available at the following link:  Announcement Details

Both of these initiatives will assist families that have relatives with disabilities.  The RRSP rollover provides another option for families in making sure our relatives are financially secure after our deaths.  As a strong advocate for the RDSP, PLAN is pleased with this proposal.  It will make the RDSP more useful for more families because for many of us, our RRSPs are our largest assets, next to our homes.

I know many families where one of the parents does not work because they must care for a relative.  In some families the working parent even has to work at more than one job.  This will make it a lot easier for them to make ends meet. In today’s world it can be difficult for a family to manage on one income.

I trust this is the start of a discussion among all political parties on how to assist Canadian families.  We are the backbone of supports for our children, dependent sons and daughters and, ever-more frequently, our parents.

Susan Whittaker

Chair, PLAN

** “PLAN is a registered charity, and as such is prohibited from engaging in partisan political activity, which is defined by the Canada Revenue Agency as activity “that involves direct or indirect support of, or opposition to, any political party or candidate for public office.” PLAN has for some time supported the policy changes referred to above, and hope that they are implemented by government, but PLAN does not support or endorse any political party or candidate for public office.”


For anyone who is interested, the Canadian Revenue Agency just came out with a webpage which provides a template of what issuers (financial institutions) might use for drafting agreements with anyone wanting to sign up for an RDSP.  This “sample pro forma declaration of trust” can be used by prospective RDSP issuers to develop their own declaration of trust.  It’s worth taking a look at as it outlines a lot of the important characteristics of the plan in a lot of detail.  Be warned – It is also written in bureaucratic-speak, so will require some sifting and interpretation for much of the sections.

To take a look you can visit:

As well, there is a section on “Frequently Asked Questions” which is very useful and answers questions like:

Who can be a beneficiary under an RDSP?  Who can be a beneficiary under an RDSP?  Can the holder of an RDSP be changed?  How long can contributions be made to an RDSP?  Who can be an issuer of an RDSP?  When is an RDSP considered registered?  When is an RDSP no longer considered registered?  

If you want to view the “FAQs” you can visit:

I thought it might be useful to run through a quick review of the Registered Disability Savings Plan. I find it very easy to get caught up in all the small details surrounding the RDSP, and as such, will run through a broad overview of the RDSP for those of you who are just beginning to acquaint yourself with the plan and prepare for its launch in December. I should also mention, in case there are some of you who would like to have a hard copy description of the RDSP, that you can click on our header under “RDSP FactSheet” to access our quick, printable two-pager.

RDSP Overview

Similar to a Registered Education Savings Plan, the RDSP is a long-term savings plan that will allow funds to be invested tax-free until withdrawal. Contributions into the plan will be permitted by anyone, including friends and family, with a lifetime limit of $200,000 which does not include government contributions or interest. While contributions may be received from anyone except the provincial government and have no annual limit, all contributions must be received before the beneficiary’s 60th birthday.

As an incentive for people to set up an RDSP and contribute into the plan, the Government of Canada has created the Canada Disability Savings Grant and the Canada Disability Savings Bond. The Grant was designed to encourage friends and family to contribute by providing generous matching contributions, while the Bond was designed to help those who may not have any friends and family in the position to help.

Highlights of the Canada Disability Savings Grant

When annual net income is equal to or less than $74,357 the grant will contribute:

$3 for every $1 contributed on the first $500.

$2 for every $1 contributed on the next $1,000.

When annual net income is over $74,357, the grant will contribute:

$1 for every $1 contributed up to $1,000.

The Grant can be received up to a maximum of $70,000 over a person’s lifetime, and only until the beneficiary turns 50 years of age.

Highlights of the Canada Disability Savings Bond

When annual net income is $20,833 or less, the Canada Disability Savings Bond will provide $1,000 per year without any personal contribution. The Bond is pro-rated if your income is between $20,883 and $37,178.

The Bond was created to make the RDSP accessible to persons with disabilities whose family and friends are not in a position to make contributions. The Bond can be received up to a maximum of $20,000 over a person’s lifetime, and only until the beneficiary turns 50 years of age.

Establishing and Managing an RDSP

Anyone who is eligible for the Disability Tax Credit can set up a plan. To find out whether you are eligible for the Disability Tax Credit you can contact the Canadian Revenue Agency or visit their website. In the case of a minor child, a parent or guardian can establish and direct the RDSP. In the case of an adult setting up a plan, they can set up a plan or can have a plan set up for them by a parent or legal guardian.

Impact on Federal and Provincial Benefits and Programs

The federal government has exempted the RDSP from affecting any federal support programs, such as CPP, OAS and GIS. For anyone living in British Columbia, Newfoundland, Yukon, and Saskatchewan, the plan is an exempt asset and you are free to use any income from your plan in whatever way you choose without affecting your income assistance.

Getting Ready for the RDSP

With the RDSP expected to become available from financial institutions in December of 2008, we are encouraging people to do two things in order to take full advantage of this plan:

  • Make sure you qualify for the Disability Tax Credit.
  • Make sure you file a 2007 tax return.

* Net income refers to a family’s combined net-adjusted income while the plan beneficiary is a minor. While they are an adult, net income refers to an individual’s net-adjusted income, and includes that of his/her spouse or common law partner.

Exciting news!  Yet another province has decided to exempt the RDSP from affecting Disability Benefits.  Saskatchewan put out a news release earlier today from the Ministry of Social Services indicating that the RDSP will not affect the calculations for those receiving social assistance, exempting both the RDSP as an asset and income.

In a statement found in the news release the Minister of Social Services for Saskatchewan Donna Harpauer is quoted as saying, “the exemption of RDSP assets and income from social assistance calculations makes sense for a number of reasons. Most importantly, it will encourage individuals with disabilities and parents of children with disabilities to create RDSPs without having to worry that the assets will be clawed back when withdrawals are made on behalf of the beneficiaries.”

This a a very exciting development for people in Saskatchewan as it now means they, along with BC, Newfoundland, and Yukon, can fully utilize the benefits that the RDSP provides.  The Saskatchewan Government has shown progressive and forward-thinking leadership in this move to exempt the RDSP and should be commended for this exemption of the RDSP.

If you would like to view the official news release as found on the Government of Saskatchewan’s website you can visit

As well, you can read the Leader-Post (Regina) article written by Pamela Cowan that does a good job of explaining the importance of this move for Saskatchewan.  You can view this article at

With the serious possibility of an election in the Fall many people are wondering whether this will impact the launch of the RDSP in December. There are a few reasons why the upcoming election should not concern people who are planning to set up an RDSP in December.

1) The RDSP received Royal Assent in December of last year and is solidified in the Income Tax Act and Canada Disability Savings Act. Unlike a Bill that is still in First or Second Reading in front of the House of Commons, the RDSP has already passed through the political system and has been entrenched in Canadian legislation.

2) The Federal Government, including the Department of Human Resources and Social Development, Finance Canada, and the Canadian Revenue Agency, are all in final preparations for the launch in December and are continuing to work with financial institutions to make sure it is available to Canadians before the end of this year.

3) All three parties have been supportive of the RDSP and have indicated that it is a powerful and important plan for Canadians facing the challenges of living with a disability.

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