Make a contribution to your Registered Disability Savings Plan (RDSP) and you can expect the government will make a generous matching “Grant” contribution. But how much should you contribute? If you are not careful, you could end up contributing more to your RDSP account than you needed.
Calculating the maximum Grant and what you need to contribute isn’t always straight-forward. It is especially complex if you have not received all the RDSP Grants from previous years (READ: How to Maximize Your RDSP). Even if you understand the calculations, you still need a host of information that might not be readily at hand.
If you are not sure what to contribute, the government provides that information to you by mail. Each year, near the end of January, you receive an “Annual Statement of Entitlement” in the mail from the Federal Government. The statement includes a table that outlines the available Grant entitlements.
Here is an example of the table:
But what do these three different amounts represent? Here is a breakdown to make it easier to understand.
Total Grant entitlement available:
The amount of Grant the RDSP beneficiary is entitled to from the Federal Government, including Grant amounts from previous years. In the example above, the Total Grant entitlement is $28,000. However, you can’t collect $28,000 in one year. The maximum Grant you can collect in one year is $10,500. If the entitlement is more than $10,500, it will take you multiple years to collect it.
Maximum Grant Available in 2018:
Simply put, this is the maximum Grant amount you can receive from the government in the current year.
Contribution which would attract Maximum Grant in 2018:
This is the amount you need to contribute to the RDSP to receive the maximum Grant amount. In this example, you need to contribute $4,250 to receive the full $10,500 Grant available for 2018.
As the notes in the tables state, you are not required to contribute the amount needed to collect the maximum Grant. You can contribute less or even chose to contribute nothing at all.
If you can’t find your Statement of Entitlement, you can contact the Government at 1-800-959-8281. You will need your SIN number when you call. Ask them for the following information:
- The maximum Grant amount you are eligible to receive this year.
- The amount you need to contribute to receive the maximum Grant.
Once you have that information, you can decide what to contribute and not risk contributing more than required.