How to Withdraw Money from an RDSP (and the 10-Year Repayment Rule)

What Is an RDSP? introduces DAPs and LDAPs and states the repayment ratio in one line. This guide goes much deeper: the actual LDAP calculation, worked repayment-rule examples with real numbers, how the 10-year lookback genuinely works, and what changes at 60 or with a shortened life expectancy diagnosis.

DAPs and LDAPs, in full

A Disability Assistance Payment (DAP) is a withdrawal made on request — one-time or occasional, whenever the holder chooses to take money out, subject to the repayment rule covered below.

A Lifetime Disability Assistance Payment (LDAP) works differently. It's a recurring, formula-based annual payment. LDAPs can start earlier if the holder chooses, but they must begin no later than the end of the year the beneficiary turns 60. Once started, an LDAP continues every year — at least the calculated minimum amount — for as long as the account holds money, or until the beneficiary dies.

The LDAP minimum withdrawal formula

Once LDAPs begin, there's a minimum amount that must come out each year. The formula is:

Minimum LDAP = A ÷ (B + 3 − C) + D

Where:

• A = the RDSP's fair market value on January 1 of that year (excluding any locked-in annuity)
• B = the greater of 80, or the beneficiary's age (in whole years) on January 1 of that year
• C = the beneficiary's age (in whole years) on January 1 of that year
• D = any locked-in annuity payments already received that year

In plain terms: the older the beneficiary and the larger the account balance, the higher the required minimum payment. The formula is designed to spread the account down gradually rather than all at once.

There's no maximum on an LDAP — a holder can always withdraw more than the calculated minimum in a given year, though doing so still triggers the repayment rule below on any grant or bond money that's still within its 10-year window.

The repayment rule, in full detail

The RDSP repayment rule exists to discourage withdrawing money shortly after receiving government grants and bonds — without it, someone could theoretically contribute, receive matching CDSG or CDSB, and immediately withdraw it.

The mechanism: the RDSP issuer maintains an Assistance Holdback Amount (AHA) — the total CDSG and CDSB paid into the plan within the last 10 years, minus any of that already repaid. For every $1 withdrawn, $3 of the AHA must be repaid to the government, up to the full amount of the AHA. Withdrawing more than roughly a third of the AHA in a single DAP simply repays the entire AHA, not more.

Worked example 1: withdrawing while grants are still recent

Malik's RDSP received the maximum CDSG and CDSB — $3,500 and $1,000, or $4,500 combined — every year from 2016 through 2020 (5 years), then his family's contributions stopped. In 2026, wanting to cover an unexpected expense, Malik withdraws $2,000 from the RDSP.

Worked example 2: the same withdrawal, years later

Malik doesn't withdraw in 2026 after all, and no further grants or bonds are added to the account. By 2031, he withdraws the same $2,000.

These two examples show the same withdrawal amount producing a $6,000 repayment in one case and $0 in the other — the only difference is timing relative to the last grant or bond deposit, not the withdrawal itself.

The 10-year clock isn't fixed to account opening

A common point of confusion: the 10-year rule doesn't run once, starting the day the RDSP is opened. It's a rolling lookback measured backward from the date of each withdrawal. Every new grant or bond deposit effectively extends the exposure window another 10 years from that deposit date, while older deposits keep aging out on their own schedule. An account that stops receiving grants and bonds becomes progressively less exposed to the repayment rule over time, exactly as worked example 2 shows.

What changes at 60

The repayment rule stops applying entirely once the beneficiary turns 60. Any DAP or LDAP taken after that point doesn't trigger repayment of any grant or bond money, regardless of how recently it was deposited. This lines up with the LDAP requirement itself, which must begin no later than that same age.

The shortened life expectancy provision

A beneficiary certified in writing by a medical doctor or nurse practitioner as not likely to survive more than 5 years can have their RDSP designated a Specified Disability Savings Plan (SDSP).

Under an SDSP election:

• Withdrawals don't trigger repayment of grants or bonds, as long as the taxable portion of withdrawals in a calendar year stays at or under $10,000.
• This gives a beneficiary with a genuinely shortened life expectancy meaningful access to their own account without the usual 10-year repayment consequences, which otherwise wouldn't make sense to apply given the circumstances.

This is a significant, specific provision — worth raising directly with the RDSP issuer if it could apply, since it isn't automatic and requires the formal medical certification and election.

Common mistakes

• Assuming the 10-year window is fixed from account opening. It resets with each new grant or bond deposit and is always measured backward from the withdrawal date.
• Withdrawing a large amount shortly after a big grant/bond year without checking the AHA first, and being surprised by how much gets repaid.
• Not knowing LDAPs must start by 60. Waiting past that point isn't an option — the requirement is mandatory, not optional.
• Assuming any DAP requires repayment. If the AHA is already $0 — because enough time has passed since the last grant or bond — a withdrawal can trigger no repayment at all.
• Not asking about the SDSP election when a shortened life expectancy diagnosis exists. It isn't applied automatically and requires a formal medical certification and holder election.

Sources

• InfoCapsule 16: Repayment obligation — Employment and Social Development Canada
• InfoCapsule 13: Shortened life expectancy — Employment and Social Development Canada
• How RDSP payments and withdrawals work — GetSmarterAboutMoney.ca
• Registered Disability Savings Plan — Employment and Social Development Canada

This article is general financial education, not personalized financial, legal, or tax advice. RDSP withdrawal calculations, AHA balances, and SDSP eligibility depend on individual account history and circumstances — confirm your own numbers with the RDSP issuer before making a withdrawal decision.

What to do next

Before making any RDSP withdrawal, asking the issuer for the account's current Assistance Holdback Amount is the single most useful step — it turns the repayment rule from an abstract concern into an exact number. For the full picture of how RDSPs work, see What Is an RDSP?. This is the sixth guide in an ongoing RDSP series — more will link back here as they publish.