Canada Education Savings Grant
The Government of Canada encourages the use of Registered Education Savings Plans (RESP) to save for a child's post-secondary education, which includes full or part-time studies at a trade school, CEGEP, college, university, or in an apprenticeship program.
Employment and Social Development Canada (ESDC) administers two education savings incentives linked to RESPs, the Canada Education Savings Grant and the Canada Learning Bond.
The Canada Education Savings Grant (CESG) consists of a basic grant of 20% on the first $2,500 in annual personal contributions to an RESP (this grant is available to all eligible children regardless of their adjusted family net income), as well as the additional amount of CESG, which is:
10% on the first $500 of annual personal contributions for children from families with an adjusted family net income between $46,605* and $93,208*
20% on the first $500 of annual personal contributions for children from families with an adjusted family net income of $46,605* or less
*Adjusted family net income levels are subject to annual indexing for inflation.
The CESG is available until the calendar year in which the beneficiary turns 17, and the maximum lifetime amount, including the additional CESG, is $7,200.
The following chart gives you a brief overview of how the CESG is calculated depending on the adjusted family net income:
Every child under age 18 who is a resident of Canada will accumulate $400 (for 1998 to 2006) and $500 (from 2007 and subsequent) of unused CESG room. Unused CESG contribution room is carried forward and used when RESP personal contributions are made in future years provided that the specific contribution requirements for beneficiaries who attain 16 or 17 years of age are met.
Beneficiaries qualify for a grant on the contributions made on their behalf up to the end of the calendar year in which they turn 17 years of age.
However, since the CESG has been designed to encourage long term savings for post-secondary education, there are specific contribution requirements for beneficiaries who attain 16 or 17 years of age. Beneficiaries who are 16 and 17 years old may be eligible to receive the CESG if at least one of the following two conditions is met:
a minimum of $2,000 was contributed to (and not withdrawn from) the RESP of the child before the end of the calendar year the beneficiary turned 15
a minimum annual contribution of $100 was made to (and not withdrawn from) the RESP in at least four of the years before the end of the calendar year the beneficiary turned 15
This means that you must start to save in RESPs for your child before the end of the calendar year in which your child turns 15 years of age in order for your child to be eligible to receive the CESG.
The CESG and accumulated earnings will be part of the EAPs paid out of the RESP to the beneficiary.
If the beneficiary does not pursue post-secondary education, the CESG is returned to the government.
Canada Learning Bond
ESDC provides an additional incentive of up to $2,000 to help low-income families start saving early for their child's education after high school (post-secondary education).
The Canada learning bond (CLB) money will be deposited directly into the child's RESP.
The CLB is available for eligible children from low-income families born in 2004 or later and provides an initial payment of $500 plus $100 for each year of eligibility, up to age 15, for a maximum of $2,000. Personal contributions are not required to receive the CLB. To help cover the cost of opening an RESP, ESDC will pay $25 into the RESP to which the initial CLB of $500 is deposited in recognition of a one-time incidental expense that may be associated with opening the RESP account.
Children who are in care of a public primary caregiver for whom a special allowance under the Children's Special Allowance Act is paid, are also entitled to the CLB.
If the beneficiary does not pursue post-secondary education, the CLB is returned to the government.
For more information on the CLB, call 1-800-O-CANADA (1-800-622-6232).
Quebec Education Savings Incentive (QESI)
The Quebec education savings incentive (QESI) is a tax measure that encourages Quebec families to start saving early for the education of their children and grandchildren.
The incentive, which came into effect on February 21, 2007, consists of a refundable tax credit that is paid directly into a registered education savings plan (RESP) opened with an RESP promoter that offers the QESI.
For the credit to be paid to your account, the trustee designated by your RESP promoter must apply for it with Revenu Quebec.
If you wish to open an RESP, you may contact an RESP promoter that offers the QESI such as any of the following:
a financial institution
a group plan dealer
a financial service provider
For more information, go to Revenu Quebec or call Service Quebec at 1-877-644-4545.
BC Training and Education Savings Grant Program (BCTESG)
Families in British Columbia are encouraged to start planning and saving early for their children’s post-secondary education or training program. To help, the B.C. Government will contribute a grant of $1,200 to eligible children through the BCTESG.
To be eligible for the BCTESG, a child must meet the following three criteria:
the child was born in 2006 or later
at the time of application the child and a parent/guardian of the child are residents of British Columbia
at the time of application the child is the beneficiary of an RESP with a participating financial institution
Children are eligible for the BCTESG on their sixth birthday up until the day before their ninth birthday.
The BC Government has extended the eligibility criteria for children born in 2006. If your child was born in 2006, you have an extension until August 14, 2019, to get the grant.
For more information, go to Province of British Columbia or call 1-888-276-3624.
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