The federal government will introduce legislative amendments to make it easier for low income Canadians to use Registered Disability Savings Plans, finance minister Jim Flaherty said Thursday.

RDSPs allows tax sheltered savings for individuals eligible for the Disability Tax Credit.

“The Tax Court of Canada has recently held that existing income tax law would not allow an individual to appeal a determination concerning an individual’s eligibility for the Disability Tax Credit unless that determination affected the individual’s tax payable,” explains Flaherty.

“As a result, individuals whose income is too low to pay tax are effectively barred from establishing an RDSP where their eligibility for the Disability Tax Credit has not been accepted by the Canada Revenue Agency.”

Flaherty says these procedural issues should not prevent individuals who wish to establish their right to the Disability Tax Credit and open an RDSP.

“I intend to introduce legislative amendments at the earliest opportunity so that individuals can, in every case, appeal a determination concerning their eligibility for the Disability Tax Credit,” Flaherty says.

IE