BMO Financial Group
TSX : BMO
NYSE : BMO

BMO Financial Group

December 20, 2016 08:00 ET

BMO Surpasses $1 Billion in RDSP Assets Under Management

- BMO renews partnership with the Plan Institute to promote RDSP education

- Deadline for 2016 tax year RDSP contributions December 31, 2016

TORONTO, ONTARIO--(Marketwired - Dec. 20, 2016) - BMO Financial Group today announced that it has surpassed $1 billion in assets under management for customers holding Registered Disability Savings Plan (RDSP) accounts.

At the same time, BMO announced a renewed partnership with the Plan Institute – a not-for-profit organization committed to ensuring the safety, security and well-being of those living with disabilities – to support the growth of the RDSP across the country. Under the agreement, BMO will distribute Plan Institute educational materials on the RDSP, while the organization will assist eligible individuals with opening RDSP accounts at BMO.

"As the first Canadian bank to offer this innovative product in 2008, we are proud to have reached this milestone – demonstrating our continued market leadership for this important segment," said Trevor Philp, Senior Manager, Registered Products and Managed Solutions, BMO Global Asset Management. "An RDSP can play a critical role in helping reduce the financial strain on individuals and families, given the significant savings a beneficiary can accumulate through the Canada Disability Savings Grant (CDSG) and the Canada Disability Savings Bond (CDSB), as well as the impact of tax-deferred investment growth."

Mr. Philip added, "With the renewal of our partnership with the Plan Institute, we hope to continue to build awareness of the RDSP, and help support the needs of individuals with disabilities in communities across Canada."

In Canada, those living with a disability can benefit from access to the RDSP – a savings vehicle that helps families manage the financial costs associated with having someone, or caring for someone, with a severe and prolonged disability. It is available to Canadians who are eligible for the Disability Tax Credit, and can provide peace of mind to parents and other contributors who may put a plan in place for a beneficiary with a disability.

For more information on investing in an RDSP, visit bmo.com/rdsp. The RDSP contribution deadline for the 2016 tax year is December 31, 2016.

BMO also recognized the early initiatives by the Government of British Columbia, both to educate eligible investors about the benefits of the RDSP and to help those who would benefit from the program become investors in it. "B.C. has taken great strides in supporting the RDSP, following the recommendations of its RDSP Action Group," noted Mr. Philp. "We would encourage other provinces to consider the best practices of the B.C. model to help make the RDSP more accessible to Canadians."

About the RDSP

The RDSP encourages families and individuals to save for the long-term financial security of persons with severe and prolonged disabilities. It is available to Canadians who are eligible for the Disability Tax Credit, and can provide "peace of mind" to parents and other contributors who may put a plan in place for a beneficiary with a disability.

  • Contributions are not tax deductible but grow on a tax-deferred basis
  • Earnings generated on contributions are tax-exempt while in the plan
  • When earnings are withdrawn as part of a disability assistance payment, they are taxable in the hands of the beneficiary (likely to be taxed at a lower rate)
  • Only one beneficiary can be named per RDSP. A beneficiary can hold only one RDSP
RDSP
What is it? A tax-deferred savings vehicle that provides long-term financial security for persons living with a disability.

Includes government incentives such as the Canada Disability Savings Grant (CDSG) and Canada Disability Savings Bond (CDSB) that could add up to an additional $90,000 per individual.
Who is eligible? Canadian residents must open an RDSP in the year before they turn 60, (or by Dec 31 in the year in which they turn 59), have a valid SIN, and are eligible for the Disability Tax Credit.
Who can set up an account? An account can be set up by the beneficiary, parents of a minor (ages vary depending on province of residence) beneficiary or any individual or organization legally authorized to act on behalf of the beneficiary.
Who can contribute? Anyone can contribute to an RDSP, provided they have written consent of the account holder.
What is the contribution limit? Up to $200,000 lifetime per individual over the life of the RDSP.

There is no annual contribution limit.
Contribution deadlines? Annual contribution deadline for Grants and Bonds: December 31.

Last day for Grants and Bond eligibility: December 31 of the year the beneficiary turns 49 years of age.

Last day contributions permitted to the plan: December 31 the year the beneficiary turns 59 years of age.

About BMO Financial Group

Established in 1817, and currently marking its 200th year of operations, BMO Financial Group is a highly diversified financial services provider based in North America. With total assets of $688 billion as of October 31, 2016, and more than 45,000 employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to more than 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, Wealth Management and BMO Capital Markets.

Contact Information