When you can withdraw
An RDSP is a long-term savings plan. You can ask for withdrawals at different times, but two types matter most:
- Disability assistance payment (DAP): a one-time withdrawal paid to the beneficiary. You must request each payment separately. Issuers set their own rules for lump-sum DAPs.
- Lifetime disability assistance payment (LDAP): recurring payments that must begin by December 31 of the year the beneficiary turns 60, and continue at least once a year until the plan ends or the beneficiary dies. You may be able to start LDAPs earlier by talking to your issuer.
Only your RDSP issuer can tell you how much you can withdraw and when payments can start.
The 10-year assistance holdback amount
The assistance holdback amount (AHA) is the total grants and bonds paid into the plan in the previous 10 years, minus any amount already repaid to the government. If you received grants or bonds within the last 10 years and take money out, you may have to repay some of that assistance.
Since January 1, 2014, repayment is proportional: for each $1 withdrawn as a DAP, up to $3 of grant and/or bond may be repaid to the government, capped at the holdback amount. Exceptions apply after age 60, when the last grant or bond was more than 10 years ago, or in some reduced life expectancy cases. See official sources for details.
Illustrative example (not your plan)
Suppose $6,000 in grants and bonds were paid into the plan during the last 10 years. That $6,000 is the holdback amount. If the beneficiary withdraws $1,000, the repayment would be $3,000 ($3 for each $1 withdrawn). A $2,500 withdrawal would imply $7,500, but repayment is capped at $6,000.
This example is for learning only. It does not calculate repayment for any real plan.
Why this matters
The RDSP is designed for long-term savings as the beneficiary ages. Contributing to attract matching grants and then withdrawing soon after can claw back free government money. Early withdrawals can leave less in the plan for later needs.