All income earned within an RESP is tax-sheltered until it is withdrawn. Withdrawals are taxed at the student’s rate, which is typically in a lower tax bracket, meaning less tax may be paid.
Children have up to 35 years to access and use their RESP. Or, if they don’t pursue post-secondary education, you can select a new beneficiary or collapse the plan if the child does not attend.
Government education grants
Your savings grow even faster with government incentives from the Canada Education Savings Grant (CESG) and Canada Learning Bond (CLB). These grants and incentives do not impact your contribution room.
100% Deposit Guarantee
All your deposits are guaranteed 100% by the Deposit Guarantee Corporation of Manitoba.
RESP Frequently Asked Questions
What happens if the child doesn’t pursue post-secondary education?
RESPs are all about flexibility and choice, so, if a child named in your RESP chooses not to go to college or university you have several options:
- Change the plan to another child
- Transfer money to another RESP
- Transfer the money to your RRSP
- Close the plan and cash out
Can I use my RESP for costs other than tuition?
Yes, RESPs can use used to cover the cost of both tuition and a student’s living expenses as Educational Assistance Payments.
Which schools qualify for Educational Assistant Payments?
Most Canadian post-secondary institutions and programs qualify for the RESP Educational Assistance Payments. Visit the Government of Canada website for a full list of qualifying institutions and additional information here.