RDSP Rollover From a Parent or Grandparent’s Estate — Move Certain Registered Funds to an Infirm Child’s RDSP
What Is It?
When a parent or grandparent dies, certain RRSP, RRIF, RPP, PRPP, or SPP amounts can sometimes be rolled into the RDSP of a financially dependent child or grandchild with a disability.
Do I Qualify?
- The deceased held eligible registered funds such as an RRSP, RRIF, RPP, PRPP, or SPP
- The beneficiary is a financially dependent child or grandchild with an impairment in physical or mental functions
- The beneficiary has an RDSP or can open one if otherwise eligible
- The transfer amount fits within the RDSP rollover rules and lifetime limits
How To Use It
- Confirm the deceased plan type and the proposed beneficiary’s dependency and disability status.
- Ask the issuer and tax preparer whether the amount is an eligible rollover.
- Transfer the amount to the beneficiary’s RDSP using the required paperwork.
- Keep proof of the relationship, dependency, and transfer amount.
What Most People Don’t Know
- This is easy to miss because families often assume an RDSP can only be funded by normal contributions.
- A rollover does not attract matching grants the way ordinary RDSP contributions can.
- The availability of the rollover depends on both dependency and disability status.
Frequently Asked Questions
Is this automatic?
A: No. The estate and issuer have to process it as a qualifying rollover.
What documents help most?
A: Plan statements, RDSP information, disability-related documentation, and dependency evidence are important.
Where do I start?
A: Start with the registered-plan issuer and the RDSP institution before the estate distributes the money.
What is the biggest trap?
A: The biggest trap is paying the money out to the estate first without checking whether an RDSP rollover was available.