Can parent open RDSP for mentally disabled adult child?
by Robert McKenzie
Has anyone considered what the requirement of "legally authorized to act on behalf of the Beneficiary" means or entails in the case of parents of a mentally disabled (since birth) child who has attained the age of majority at the time a DSP is being set up.
It seems clear from the definition of "Qualifying Person" that merely being a "legal parent" of such a Beneficiary (i.e., one who has attained the age of majority) is not sufficient to meet the "legally authorized to act on behalf of the Beneficiary" test.
The question seems to be: in a case where the Beneficiary (who has attained the age of majority) has been significantly mentally disabled from birth (and, hence, cannot grant a Power of Attorney to anyone to act on his/her behalf), what is required or will suffice to meet the account holder requirement of being "legally authorized to act on behalf of the Beneficiary"?
Must parents, in such circumstances, go to the expense (and encounter the delays) of retaining legal counsel and obtaining a formal guardianship order of some sort before they can set up a valid RDSP for their mentally disabled child?
(This seems like a very substantial burden and roadblock for many parents and one that has not been well-publicized, if indeed this is the case. Could such a burden and roadblock really have been intended? )
If a formal guardianship order is not required, then what, specifically, is a viable alternative to such an order?.
So far, I haven't found anyone meaningfully addressing this issue. I, for one, have delayed proceeding to set up a DSP for our mentally disabled adult daughter specifically because of grave concern over this technical issue.
As you may be aware, in a situation of the kind described, there is no valid DSP from inception unless the arrangement (Plan) is entered into with someone who is "a Qualifying Person in relation to the Beneficiary at the time the arrangement is entered into".
This clearly suggests that even if a legal parent were to obtain a guardianship order subsequent to setting up a DSP, that would not remedy the initial defect.
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Hope this helps!
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