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BENEFITS OF REGISTERED EDUCATION SAVINGS PLAN (RESP)

A Registered Education Savings Plan (RESP) is a savings account registered with the Canada Revenue Agency (CRA).  It designed to help families save for their children's post-secondary education.  Contributions made to an RESP grow tax-free until the beneficiary enrols in a qualifying post-secondary program. A lifetime limit of $50,000 per child can be contributed to an RESP. When withdrawing money for educational purposes, any income earned on the contributions is taxed in the hands of the beneficiary, who will typically have little income as a student and will likely pay minimal to no tax on the withdrawal.

BENEFITS

• Lifetime contribution limit for each bene ciary is $50,000
• Grants and income grow tax-free in an RESP until withdrawn and are taxed in the hands of the benefciary 

 

PLAN TYPES

FAMILY RESP

  • Can have one or more beneficiaries who are related by blood or adoption to the subscriber(s)

  • Beneficiary must be under age 21 to be added to the plan

  • Ideal for families with more than one child as the CESG and income are shared by all beneficiaries in the plan

INDIVIDUAL RESP​

  • Can only have one beneficiary who may or may not be related to the subscriber

  • No age limit for the beneficiary to be added to the plan

  • Recommended for: single-child families, families with large age differences between children and subscribers who wish

    to set up an RESP for someone to whom they are not related 

 

PROVINCIAL GRANTS AVAILABLE

CANADA EDUCATION SAVING GRANT (CESG) 

  • Annual maximum of $1,000 if catch-up room is available

  • $7,200 lifetime maximum per beneficiaries

  • Beneficiaries are eligible up to the end of the calendar year in which they turn 17

CANADA LEARNING BOND (CLB)

  • For beneficiaries born on Jan. 1, 2004 or later, whose primary caregiver receives the national Child Benefit Supplement

  • $500 initial bond plus $100 per eligible year up to age 15 of the beneficiary

  • Must apply before the beneficiary turns 21 

ALBERTA CENTENNIAL EDUCATION SAVINGS PLAN (ACES) 

  • Jul. 31, 2015: Closed to new applications 

  • Jan. 1, 2016: Any ACES amounts remaining in an RESP convert to accumulated income – not taxable while it remains in the RESP 

B.C TRAINING AND EDUCATION SAVINGS GRANT (BCTESG) 

  • $1,200 one-time grant to eligible children born on Jan. 1, 2007 or later

  • Must apply between the becefniary’s 6th and 9th birthdays

  • Application deadlines have been extended for beneficiaries born prior to Aug. 15, 2009 

QUEBEC EDUCATION SAVINGS INCENTIVE (QESI) 

  • Annual maximum of $500 if catch-up room is available

  • $3,600 lifetime maximum per beneficiary

  • To be eligible, beneficiaries must be less than 18 years old and a Quebec resident as of Dec. 31 of the applicable year

SASKATCHEWAN ADVANTAGE GRANT FOR EDUCATION SAVINGS (SAGES) 

  • Equal to 10% of annual contributions made since January 1, 2013, up to a maximum of $250 per bene ciary per year (maximum of $500 if catch-up room is available)

  • $4,500 lifetime maximum per beneficiary​

  • Beneficiaries are eligible up to the end of the year in which they turn 17 as long as they are a resident of Saskatchewan at the time of contribution​

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