Who is eligible to receive the Grant?

Beneficiaries are eligible for the CESG up to the end of the calendar year in which they reach age 17 (certain conditions exist for beneficiaries 16 and 17 years of age). To be a recipient of the CESG the RESP beneficiary must be a resident of Canada at the time the contribution is made, and have a valid Social Insurance Number (SIN).

How does the 16 and 17 rule work?

The Canada Education Savings Grant Program has been designed to encourage long term savings for post-secondary education.
There are special rules for beneficiaries in the years they become age 16 or 17. RESPs for beneficiaries aged 16 and 17 will be eligible only if at least one of the following conditions is met:
* a minimum of $2,000 of contributions has been made to, and not withdrawn from, RESPs in respect of the beneficiary before the year in which the beneficiary attains 16 years of age; or
* a minimum of $100 in annual contributions has been made to, and not withdrawn from, RESPs in respect of the beneficiary in at least any four years before the year in which the beneficiary attains 16 years of age.
This means that you must start to save in RESPs for your child before the end of the calendar year in which they turn 15 years of age in order to be eligible for the grant. 

Are there any fees to apply for the Grant?

There are no fees associated with the Grant as such, although some RESP promoters may apply service or administration fees. The Grant is based on total contributions made to an RESP on behalf of a beneficiary. Any fees would depend on the promoter and the RESP contract signed by the subscriber. Subscribers should select the plan they are most comfortable with.

Top of Page

I can only put aside a few dollars a week. Does this still make sense?

Absolutely. No matter how little or how much you invest in a child's RESP, the Government of Canada will contribute a grant of an additional 20% on top of your annual contribution, to a maximum of $400 a year, until the child turns 17. The CESG applies to any amount up to the first $2,000 you contribute each year, but you may contribute as much as $4,000 per year. By the time your child is ready for post-secondary education, your savings could have grown into a significant nest egg. Even if you need to skip making regular contributions from time to time-for example, because of unexpected household expenses-your savings will continue to grow.

If one beneficiary is named under two plans, and contributions are made to each plan, which plan gets the Grant?

The Grant will be paid on a first come first served basis, subject to annual and lifetime limits. In the event that two subscribers make contributions in the same month to two separate RESPs, the subscriber's contribution dated earliest in the month will receive the Grant. In the event that the contributions are made on the same day, the grant will be pro-rated.

If a father and mother have joint custody of a child, is the grant available to both parents?

Yes, both parents will receive the grant; however, the combined amount of grant cannot exceed the beneficiary's limit of $400 per year. Where more than one subscriber exists for a single beneficiary, it is important for subscribers to ensure maximum contribution levels are respected. 

A subscriber contributes $3,000 to an RESP in 1999 and attracts the maximum CESG based on the first $2,000 contributed. Will the difference of $1,000 ($3,000 - $2,000) attract CESG in the following year?

Contributions made in a year which do not attract the CESG may not be carried forward to the following calendar year for purposes of attracting the CESG. The difference of $1,000 will not attract grant in the year 2000.

Can a beneficiary benefit from more than one Grant per year?

Yes, a beneficiary can benefit from more than one grant per year, up to a maximum of $800, under certain circumstances. Beginning on January 1, 1998, each child accumulates grant room of $400 per year, up to and including the year in which they attain age 17. For example, a subscriber decides to interrupt contributions for a period of one year, the unused grant room for that period will be carried forward for use in future years. Upon resuming contributions, the subscriber may decide to contribute $4,000 into the RESP. Because grant room has been carried forward and provided that the lifetime limit of $7,200 in grant has not been exceeded, the amount of grant paid will be $800. 

Top of Page

Is the calendar year used for CESG purposes?

Yes. The calendar year is used to determine Grant eligibility, the amount of contributions made, the grant room earned and used in the year.

Other Details of the Grant