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RESP Info Page

REGISTERED EDUCATIOAL SAVINGS PLANS (RESPs)

Maximum Contribution - There is no annual limit for contributions to RESPs. For each beneficiary the lifetime amount that can be contributed to an RESP is $50,000.

Contribution Age Limit - Contributions can be made until December 31 of the 31st year following the year the plan is entered into. Family plan only: final contribution must be made before the beneficiary’s 31st birthday.

Plan Age Limit – The RESP must be collapsed before December 31st of the 35th year following the year the plan is entered into.

Tax on Over-Contribution – Equals 1% per month of the over-contribution amount at the end of the month

Basic Canada Education Savings Grant (CESG) – Equals 20% on annual contributions made to all eligible RESPs for a qualifying beneficiary, to an annual maximum of $500 ($1,000 where there is unused grant room from a previous year.

Unused CESG grants may be carried forward for possible use in the future. Lifetime maximum CESG amount per beneficiary is $7200. 

Refer to CRA for further limitations that may apply.

Additional CESG (family income under $43,953) - CESG on the first $500 in annual RESP contributions is 20%

Additional CESG  (family income $43,953 to $87,907) - CESG on the first $500 in annual RESP contributions is 10%

Canada Learning Bond (CLB) - Provides $500 at birth and $100 annually to a maximum of $2000 until age 15 for children born after 2003 to families entitled to the National Child Benefit Supplement. It is paid only in years when the family’s income qualifies.

Educational Withdrawals

  • Educational Assistance Payment: Grant monies and accumulated income payable to the beneficiary and taxable as earned income to the beneficiary.
  • Post-Secondary Capital Withdrawal: Payable to the subscriber who may gift it to the subscriber or retain it for himself/herself with a tax penalty

Non-Educational Withdrawals

  • Accumulated Income Payment: Subject to certain conditions, payable to subscriber who can transfer the amount to his/her RRSP. If taken as cash, amount is taxable base on subscriber’s marginal tax rate plus an additional 20% withholding tax. Amounts can also be paid to a designated educational institution in Canada
  • Non-Educational Capital Withdrawal: Triggers the requirement to pay back CESG equal to 20% of the amount of the withdrawal.

Provincial Grants - May be available in some province and varies from province to province. Check the applicable provincial legislation.