RESP

Registered Education Savings Plan

• All children resident in Canada (up to the end of the calendar year in which they turn 17) are eligible to receive money from the federal government for their post secondary education as long as RESP has been opened for them.
• You can open a RESP for a child or grandchild
• You can contribute a lifetime maximum of $50,000 per child (beneficiary) to an RESP.
• You can contribute to a RESP for up to 31 years, and plan remain open for maximum 35 years.
• The amount of annual contribution room that is eligible for the Canadian Education Savings Grant (CESG) is $2,500. You can contribute more, but the 20% grant is only matched by the Canadian government up to $2,500 per year.
• Government of Canada contributes up to $2,000 to a RESP for an eligible child from low income families.
• There is no tax deductible for the contributions, however the money inside the plan will grow tax deferred until its withdrawn for a post-secondary educational program.
• Your child (beneficiary) pay taxes on their education assistance payments (EAPs), however their income will be likely low, they will pay little to no tax.
• Your child (beneficiary) receives payments from their RESP once they have enrolled in a post secondary program.
• Should your child decide not to pursue any post secondary education, you can transfer the savings to another child or withdraw your contributions tax free, certain conditions may apply.