What is an RESP? How the grant works in Canada

The Canada Revenue Agency (CRA) describes an RESP as a contract between the person who opens it (the subscriber), the federal government and an organization that runs the plan (the promoter). The subscriber names one or more children as beneficiaries and makes contributions. The promoter agrees to pay educational assistance payments to the student later. Family plans are the only RESP that let one subscriber name more than one beneficiary, and each beneficiary must be related to the subscriber by blood or adoption.

The basic CESG is 20% of the personal contributions made in a year, at any income level. The most it pays per child in a year is $500, which means contributing $2,500. The lifetime limit is $7,200 per child.

Unused grant room carries forward. Each child who is a Canadian resident under 18 earns $500 of grant room a year from 2007 ($400 a year from 1998 to 2006). If you missed years, the CESG can pay up to $1,000 in a single year, so a catch-up year of $5,000 can bring in $1,000 if the child has the room. Grants are paid on contributions up to the end of the calendar year the child turns 17.

To see how this adds up over 18 years, use our RESP growth calculator. To check how much grant room you may have, use our RESP contribution calculator.

On the first $500 you contribute each year, families with lower or middle adjusted family net income can get an additional CESG on top of the basic 20%. These are the CRA's figures for 2026 income:

The CRA page does not say what applies to incomes just above or below these limits. If your income is close to a limit, check the CRA page or ask your RESP provider.

The Canada Learning Bond (CLB) is extra money for children from low-income families. You do not have to contribute to get it. The CRA lists these amounts:

• $500 for the first year the child is eligible, plus a separate $25 payment to help cover the cost of opening an RESP.
• $100 for each additional year of eligibility.
• A lifetime maximum of $2,000.
• It is for children born in 2004 or later from low-income families, and for children in the care of a public primary caregiver who receives a special allowance. Annual payments continue up to age 15. A young person must be under 21 when they apply.

If you think your child may qualify, ask your RESP provider how to apply. The CRA page explains who qualifies.

A child can still get the CESG at ages 16 and 17, but only if the RESP met one of two tests before the end of the year the child turned 15. Either $2,000 or more was put in and left in, or at least $100 was put in during each of four or more years.

The CRA explains that money comes out in different ways, and each is taxed differently:

• Educational assistance payments (EAPs) are the government grants and the growth. They are taxable income to the student. Because students often have little income, they may pay little or no tax.
• Your own contributions can be taken out by you, the subscriber, tax-free. You can give that money to the student.
• Accumulated income payments (AIPs) are growth paid out to the subscriber when it is not used for education. They are taxed at your regular rate plus an extra 20% (12% for subscribers in Quebec).

EAPs can pay for tuition, books, tools, transportation and rent, if the school and program are eligible and the student is enrolled full-time or part-time. For a full-time student, EAPs are capped at $8,000 during the first 13 consecutive weeks of study, with no set limit after that. For a part-time student the cap is $4,000 per 13-week period.

The CRA says you can keep the RESP open for future studies, name a different child, move the money to other registered savings plans, or close the plan. Each choice has its own tax and grant rules, so ask your provider what would happen to the grant and the growth before you close a plan.