Registered Education Savings Plans (RESP)

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Educational Savings Strategies
Like everyone, you want the best for your children and grandchildren – including a good education. In today’s competitive job market, a college or university degree is more important than ever before, and will likely become even more necessary in the future. That’s why it’s essential to start planning now for how you will meet the costs of that education.

Registered Education Savings Plans (RESPs)
Registered Education Savings Plans (RESPs) are one of the best ways to meet your educational savings goals.
With RESPs, you can make contributions now towards the future cost of a child’s education. Unlike RRSPs, contributions made to an RESP are not tax deductible. However, the contributions grow tax-sheltered in the account, and the income earned on the contributions is not taxable until paid out to a beneficiary (who is typically taxed at a very low rate, if at all).

Withdrawals of income can be made to a beneficiary in full time attendance at a qualified post-secondary institution.
Continue reading Educational Savings Strategies (pdf)

Registered Education Savings Plans (RESPs)
RESPs are registered accounts that enable you to make contributions now towards the cost of a child’s future education. Unlike an RRSP, your contributions are not tax deductible but the funds grow tax-sheltered until paid out to the beneficiary.

Below are the features of RESPs, including the Canada Education Savings Grant introduced in the federal budget on February 24th, 1998, federal budget changes introduced in 2007 and 2008:

Contributions:

  • Contributions are $2,000 per year from 1998 (or the year of the child’s birth, whichever is later) to 2006 inclusive, then $2,500 contributions for 2007 onward.
  • You can contribute up to 31 years to a lifetime maximum of $50,000 per beneficiary
  • No contribution carry forwards
  • No tax deduction for contributor
  • Amounts contributed above $5,000 in a given year will not attract grant for years 2007 onward

Continue reading Registered Education Savings Plans (RESPs) (pdf)

Registered Education Savings Plans (RESPs)
RESPs are registered accounts that enable you to make contributions now towards the cost of a child’s future education. Unlike an RRSP, your contributions are not tax deductible but the funds grow tax sheltered until paid out to the beneficiary.
Below are the features of RESPs, including the proposed Canada Education Savings Grant introduced in the federal budget on February 24th, 1998.
Contributions:

  • $4,000 per beneficiary, per year maximum
  • You can contribute up to 21 years to a lifetime maximum of $42,000 per beneficiary
  • No contribution carry forwards
  • No tax deduction for contributor

Canada Education Savings Grant (CESG)

  • The government will contribute up to 20% of the first $2,000 of annual RESP contributions made after Jan 1, 1998, to a maximum of $400 per year, per beneficiary aged 17 and under
  • Lifetime maximum CESG contribution will be $7,200 per beneficiary
  • Contributions for beneficiaries aged 16 and 17 will only receive a CESG subject to certain stipulations
  • CESG room may be carried forward until the beneficiary turns 18
  • The beneficiary must have a SIN to receive the CESG

Continue reading Registered Education Savings Plans (RESPs) (pdf)