Registered Education Savings Plan (RESP)
A savings account for a child’s post-secondary education, with federal grant matching that can add thousands of dollars beyond what you contribute.
What it is
A Registered Education Savings Plan (RESP) is a savings account designed to help pay for a beneficiary’s post-secondary education. A subscriber, often a parent or grandparent, contributes to the plan on behalf of a named beneficiary, and the federal government matches a portion of contributions through the Canada Education Savings Grant (CESG). Investment growth and grant money accumulate inside the plan tax-deferred until withdrawn for the beneficiary’s education.
Eligibility, contributions & withdrawals
There’s no annual RESP contribution limit, but a lifetime contribution limit of $50,000 per beneficiary applies; contributions beyond that are subject to a 1% per month tax on the excess until withdrawn. The CESG matches 20% of the first $2,500 contributed per beneficiary each year, up to $500 in grant per year, with a lifetime CESG maximum of $7,200 per beneficiary. Unused grant room from a missed year can generally be partly caught up in a later year, for one missed year at a time. CESG eligibility generally ends in the calendar year the beneficiary turns 17, with additional conditions for 16- and 17-year-olds.
Figures current as of October 2026. Confirm current rules at canada.ca before relying on them.
Tax treatment
Contributions are made with after-tax money and are not tax-deductible, and the original contribution amount can later be withdrawn tax-free by the subscriber. Growth and grant money, when withdrawn as an Educational Assistance Payment (EAP) for the beneficiary’s education, are taxed in the beneficiary’s hands, typically a student with little other income, often resulting in little or no tax owed on that portion.
Benefits, risks, and common misunderstandings
Government grant money (CESG) can add up to $7,200 per beneficiary over the life of the plan, a direct boost beyond your own contributions.
Grants are only available up to the annual and lifetime limits, and a missed year’s grant can only be partly caught up later, not fully recovered indefinitely.
Growth and grants are taxed in the student’s hands on withdrawal, often at a very low rate.
If the beneficiary doesn’t pursue qualifying post-secondary education, grant money generally must be repaid to the government, and growth may be subject to additional tax if withdrawn as an accumulated income payment.
Can be opened as a family plan covering multiple children, with some flexibility to share unused grant and growth among beneficiaries.
Family plans have their own eligibility conditions, generally related beneficiaries. Confirm the specific rules apply to your family structure before assuming flexibility.
A common misunderstanding corrected: unused RESP money is not simply lost if a child doesn’t attend post-secondary education.
Options exist, including naming a different eligible beneficiary, transferring some amounts to an RRSP within limits, or withdrawing contributions tax-free, though grant money is typically returned to the government.
For business owners
An incorporated business owner can contribute to an RESP from personal funds the same way any other subscriber does; the RESP itself is a personal savings vehicle for a beneficiary’s education, separate from the corporation’s own retained earnings or investment planning. Some owners consider a family trust or other corporate-adjacent structures for broader estate and education planning, a different, more complex conversation than a standard RESP, worth raising in a strategy consultation if relevant to your situation.
Frequently asked questions
What happens to the government grant if my child doesn’t go to post-secondary school?
Can grandparents open an RESP?
Is there an age limit for the beneficiary?
What counts as a qualifying withdrawal?
Can I have more than one RESP for the same child?
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