RDSP competent

How To Plan For Disabled Adults Who Are Unable To Manage Their Finance?

When the disabled person is under the age of majority, there is relatively less restriction in managing for their finance. Typically speaking, the legal parents could manage on behalf of the child. It is when the child reaches the age of majority, and is not contractually competent, then there would be more procedures involved. (Note: According to Wikipedia, competence concerns the mental capacity of an individual to participate in legal proceedings or transactions, and the mental condition a person must have to be responsible for his or her decisions or acts)

Scenario#1: The disabled person had made arrangement before they became contractually incompetent

If the incapable adult child has an existing Continuing Power of Attorney (“CPOA”), the person named as his/her attorney in the CPOA will now be able to make legal and financial decisions on behalf of the incapable adult, except make a Will. It also appears, based on case law, that an attorney acting under a CPOA cannot make changes to any document having testamentary consequences, e.g. an RRSP (beneficiary) contract.


Scenario#2:  No arrangment was made by the disabled adult child

This is a very common case, especially when the disabled adult had diagnosed with special needs since they were a child. If the incapable adult child does not have an existing CPOA, the person who wish to assist in managing their finance may have to apply to court to be appointed as Guardians of Property for the adult child. Then again, once appointed, just like with the CPOA, they are generally able to do any and all acts which he/she could do, except make a Will.

This link provides some additional information on the Ontario Substitute Decision Act: https://www.attorneygeneral.jus.gov.on.ca/english/family/pgt/pgtsda.pdf

Does a person who is applying for guardianship have to hire a lawyer?

There is no legal requirement to hire a lawyer, but some applicants choose to do so.  This is especially the case when the application is to the court rather than to the Ontario Office of Public Guardian and Trustee (OPGT).  A court application must be completed and filed in accordance with the standard court rules and the requirements of the Substitute Decisions Act, 1992.  It is recommended that you consult with your own lawyer about this process.  The time required to conclude a court application varies according to the court’s schedule and the complexity of the particular case.

The Law Society of Upper Canada has a Lawyer Referral Service which will put you in touch with a lawyer for a half-hour telephone consultation at no charge to help determine your rights and options.  For more information about this service, please contact the Law Society of Upper Canada at 1-855-947-5255. If the application is successful, the guardian is usually allowed to use the incapable person’s money to pay the legal fees.




What would happen to the RDSP when the beneficiary reaches age of majority but is not contractually competent?


Suppose the parents of the disabled person already opened the Registered Disability Savings Plan (RDSP) when he/she was still a child, then the parents could remain as the account holder even when the child reaches the age of majority. According to the CRA:

“The beneficiary has reached the age of majority but his or her contractual competency to enter into a plan is in doubt. The ability for a “qualifying family member” (QFM) to open a plan under these rules applies as of June 29, 2012 and ends on December 31, 2018. A QFM includes a spouse, common-law partner, or parent of an individual.”



  • Disclaimer: The above details are only for general understanding purposes, and not intend to provide specific financial or legal advice. They could be subjected to change, and they are not guaranteed to be error-free. Individual should always consult with a financial professional or lawyer before making any decision.
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