child disability benefits

RDSP Income Matching Rates for 2016

To start off planning for your disability savings plan in 2016, I want to provide you with some updates. This morning, I called the ESDC (The government department that handles the disability savings grants and bonds.) They provided me with the new figures of the family net income to calculate for the grants and bonds. There hasn’t been too much change, they simply increased the income threshold by a little, which makes it slightly easier to qualify for these benefits.

Below are the updates on the “Canada Disability Savings Grants“, “Canada Disability Savings Bonds” and “Disability Tax Credit” I obtained from the CRA and ESDC.

The chart below outlines the matching rates of “Canada Disability Savings Grants (CDSG)” in 2016

 

Family Net Income *CDSG Matching RatesMaximum Annual CDSG
Up to or equal to $90,563- 300% on first $500
- 200% on next $1000
$3500
Over $90,563100% on first $1000$1000

 

The chart below outlines the matching rates of “Canada Disability Savings Bonds (CDSB)” in 2016

Family Net Income *Maximum Annual CDSB
Up to or equal to
$26,364
$1000
Between
$26,365 to $45,282
$1,000 is reduced on a prorated basis (based on the formula in the Canada Disability Savings Act)
Over $45,282
No bond is paid

 

  • * For a minor beneficiary, the family net income is that of his or her parents. When the beneficiary is over the age of majority, the family net income is that of the beneficiary and his or her spouse, if applicable.

 

Updated version of the Disability Tax Credit Form (T2201):

The second update is about the “Disability Tax Credit”. I checked on the CRA website, and they recently revised the T2201 form. (That’s the form to be filled out by your doctor, then mail to the CRA). On page 1, section 3 of the form, they added a section called “Adjust your income tax and benefit return“. In the past, one needs to send a separate letter to the CRA to adjust their income tax after the disability tax credit is approved. Now, you simply need to check the box, “Yes, I want the CRA to adjust my returns, if possible.“, then the CRA will do the adjustment for you. Of course, you should also check with your accountant if this arrangement would be the best option for you. Here’s the link to download the form.
http://www.cra-arc.gc.ca/E/pbg/tf/t2201/t2201-15e.pdf

 

  • Disclaimer: Details were obtained from CRA and ESDC on Jan 11th, 2016. They could be subjected to change, and they are not guaranteed to be error-free. Above details are for general understanding only, and not meant to provide any financial advice. Please always consult a financial professional before making any decision. Featured image courtesy patrisyu/FreeDigitialPhotos.net

 

Tags: , , , , ,
Previous Post
RDSP idea
Blog Ontarian with Special Needs

How To Maximize Your Disability Tax Savings And Benefits?

Next Post
kiss financial goals
Blog Personal Finance

KISS Your New Year’s Resolution

Leave a Reply

Your email address will not be published. Required fields are marked *