Appendix C. Registered Education Savings Plan provider user guide – Acronyms and definitions

C.1. List of definitions

The CESP uses the following terms throughout the Registered Education Savings Plan (RESP) provider user guide.

C.1.1. Accumulated income payment (AIP)

A payment of the income earned from a Registered Education Savings Plan (RESP), usually paid to the subscriber. It does not include the following:

• educational assistant payments (EAPs)
• payments to a designated educational institution in Canada
• transfers to another RESP
• repayment of:
  • the Canada Education Savings Grant (CESG)
  • the Canada Learning Bond (CLB)
  • the Saskatchewan Advantage Grant for Education Savings (SAGES), and
  • the British Columbia Training and Education Savings Grant (BCTESG)

A promoter cannot make an AIP as a single joint payment to separate subscribers.

C.1.2. Additional CESG

An additional amount of Canada Education Savings Grant (Additional CESG) of 10% or 20% on the first $500, or less. This is an annual limit on RESP contributions made on or after January 1, 2005. The Additional CESG paid into an RESP is on behalf of an eligible beneficiary over and above the Basic CESG. It is based on the adjusted income level of the beneficiary’s primary caregiver. For more information, refer to C.1.3. Adjusted income.

C.1.3. Adjusted income

The adjusted income of a beneficiary’s individual primary caregiver is determined by adding together:

• the net income (line 23600 of the income tax and benefit return) for the primary caregiver
• his or her cohabiting spouse or common‑law partner (if applicable)

The family net income is adjusted by:

• deducting any universal child care benefit (UCCB)
• registered disability savings plan (RDSP) payments received
• adding any UCCB and RDSP amounts repaid

For more information, refer to C.1.37. Individual primary caregiver.

C.1.4. Assisted contributions

Contributions made to an RESP that has attracted CESG payments.

C.1.5. Basic CESG

The basic amount of the CESG (Basic CESG) consists of a rate of 20% on contributions made to an RESP in respect of a beneficiary. The amount of annual Basic CESG payable per beneficiary is limited to the lesser of:

• accumulated grant room available for the beneficiary
• to the Basic CESG annual limit per beneficiary

The CESP pays the Basic CESG into the RESP on behalf of an eligible beneficiary. The CESP can make payments up until the end of the calendar year in which the beneficiary turns 17.

C.1.6. Beneficiary

Usually a child, but can be any person named by the subscriber of an RESP. This person may be eligible to receive the education savings incentive(s) and may receive EAPs from the RESP. For more information, refer to C.1.26. Educational assistance payment (EAP).

As of January 1, 2022, a person between 18 and 20 years old may be eligible to open an RESP. They would be the subscriber and could name themselves as an adult beneficiary. This is mostly done in order to apply for the Canada Learning Bond using the new application form ESDC SDE 0107. For more information, refer to Chapter 6. The Canada Learning Bond.

C.1.7. Benefit year

A period that starts on July 1st of 1 year and ends on June 30th of the next year.

C.1.8. Blood relative

The ITA describes a “blood relationship” as one between:

• a parent and child (or grandchild or great‑grandchild)
• brothers and sisters

The subscriber’s niece, nephew, aunt, uncle and cousin do not meet the definition of “blood relative”. The ITA does not consider an individual to be a blood relative of himself/herself.

C.1.9. British Columbia Training and Education Savings Grant (BCTESG)

The BCTESG is a provincial incentive designed to help families save for their children’s post‑secondary education. The CESP pays the incentive under a designated provincial program administered by ESDC through an agreement with the Government of British Columbia. The BCTESG is a $1,200 one‑time grant to eligible children born on or after January 1, 2006. When an eligible child turns 6 years old, the subscriber may be able to apply for the grant.

C.1.10. Business number (BN)

A 15-character alphanumeric code, assigned by the CRA, that identifies the RESP promoter or agent authorized to submit transactions to ESDC.

C.1.11. Canada Child Benefit (CCB)

A tax-free monthly payment made to eligible families to help them with the cost of raising children under 18 years of age.

C.1.12. Canada Child Tax Benefit (CCTB)

The CCTB was a tax‑free monthly payment made to eligible families to help them with the cost of raising children who were under the age of 18. The Canada Child Benefit (CCB) replaced the CCTB on July 1, 2016. Included in the CCTB payment was the National Child Benefit Supplement (NCBS) for eligible low‑income families. For more information, refer to C.1.42. National Child Benefit Supplement (NCBS).

C.1.13. Canada Education Savings Act (CESA)

The legislation that authorizes payment of the Basic and Additional CESG and the CLB.

C.1.14. Canada Education Savings Grant (CESG)

An education savings incentive administered by ESDC. The CESG is based, in part, on contributions made to an RESP on behalf of an eligible beneficiary. There are 2 components:

• the basic amount of the CESG (Basic CESG), and
• the additional amount of the CESG (Additional CESG)

For more information on each component, refer to C.1.5. Basic CESG and C.1.2. Additional CESG.

C.1.15. Canada Education Savings Program (CESP)

The directorate within ESDC responsible for administering the education savings incentives available to eligible RESP beneficiaries.

C.1.16. Canada Learning Bond (CLB)

The CLB is an education savings incentive introduced by the Government of Canada in 2004. This incentive is for children from low‑income families, and for children in care, born on or after January 1, 2004. The CLB consists of the initial payment and of subsequent CLB payments.

C.1.17. Canada Revenue Agency (CRA)

The federal agency responsible for the administration of RESPs governed under the ITA. The CRA also shares information with ESDC, for the purposes of validating a beneficiary’s eligibility for the Additional CESG and the CLB. They will also share information to confirm if a beneficiary is a child in the care of an agency receiving payments under the Children’s Special Allowances Act.

C.1.18. CESP system

An ESDC electronic application that supports education savings incentives administered by ESDC. It enables the exchange of electronic information between ESDC and its partners such as:

• RESP providers
• the Government of Saskatchewan
• the Government of British Columbia
• the CRA
• the SIR

C.1.19. Child in care

A child under the care of an agency (public primary caregiver) that receives payments under the Children’s Special Allowances Act for that child. For more information, refer to C.1.51. Public primary caregiver.

C.1.20. Children’s Special Allowance (CSA)

The CSA is a tax‑free monthly payment authorized by the Children’s Special Allowances Act. It is for a child who is under the age of 18, who physically resides in Canada, and who is under the care of an agency.

C.1.21. Contributions

Money deposited into an RESP by a subscriber. Contributions may be eligible to attract CESG and SAGES payments. The CESP does not consider payments made into an RESP through a designated provincial program as contributions. They therefore do not attract the CESG. For more information, refer to C.1.23. Designated provincial program.

C.1.22. Custodial parent or legal guardian

Someone that has the legal right to make decisions affecting a child’s interests, and has the responsibility of taking care of the child. This could be:

• an individual
• a department
• an agency
• an institution

C.1.23. Designated provincial program

A program defined under the ITA to encourage the financing of children’s post‑secondary education through savings in RESPs. These programs are established under the laws of a province. They are administered through an agreement between a province and ESDC. In other cases, the province is the one who administers it themselves. Payments made into an RESP through a designated provincial program are treated the same as federal grants or bonds. Therefore, they do not attract federal grants or bonds themselves. These payments are not considered to be contributions to an RESP. For more information, refer to C.1.21. Contributions.

C.1.24. Education savings incentive(s)

Refers to 1 or all of the education savings assistance programs described within this user guide. This includes:

• Basic CESG
• Additional CESG
• CLB
• SAGES
• BCTESG

C.1.25. Education savings plan (ESP)

A savings vehicle used to save for a child’s post‑secondary education. More precisely, it is a contract between an individual (the subscriber) and the RESP promoter. The subscriber makes contributions that accumulate tax‑free earnings until withdrawn. The RESP promoter agrees to use the accumulated funds to pay EAPs to 1 or more eligible beneficiaries designated by the subscriber. For more information, refer to C.1.56. Registered Education Savings Plan (RESP).

C.1.26. Educational assistance payment (EAP)

A payment from an RESP to help an eligible beneficiary cover expenses associated with post‑secondary education. An EAP consists of educational incentive amounts paid into an RESP, as well as income earned on contributions and incentive amounts. The EAP is taxable in the beneficiary’s hands. Therefore, the student must include the EAP received that year as income on their income tax return.

C.1.27. Effective date

The date a subscriber opens an RESP; also referred to as “the effective date the plan was entered into”.

C.1.28. Eligible beneficiary

A beneficiary of an RESP who meets the eligibility criteria required to receive 1 or more education savings incentives.

C.1.29. Employment and Social Development Canada (ESDC)

The federal department responsible for administering education savings incentives linked to RESPs.

C.1.30. Enrolment (full‑time/part‑time)

The post‑secondary institution determines and defines what constitutes full‑time and part‑time enrolment. For example, if the institution considers them to be enrolled full‑time, the CESP will also consider the beneficiary to be attending post‑secondary education on a full‑time basis.

C.1.31. Error reports

CESP system‑generated reports, identifying the field(s) in error. When information submitted to the CESP system is missing or improperly formatted, the CESP system will send those reports to the RESP provider. The RESP provider needs to make the correction and resubmit the information to the CESP system in a subsequent processing period(s). Until then, there could be a delay in the payment of the incentives. There are 2 types of error reports:

RT 800 – Transaction error report indicates that validation has failed or information submitted is missing or incorrectly formatted. The CESP system rejects the record and the RESP provider must correct and resubmit the transaction

RT 850 – Severe error report identifies severe errors and advises that the CESP system rejected the record. The RESP provider must correct and resubmit the transaction

C.1.32. Family RESP

An RESP that can have 1 or more beneficiary. Each beneficiary must be connected by blood or adoption to each subscriber under the plan, or have been connected to a deceased original subscriber. An individual can become a beneficiary of a family RESP only if:

• that individual has not yet turned 21, or
• if the individual was, just before joining the family RESP, a beneficiary under another family RESP

A subscriber can only make contributions to family RESPs until a beneficiary turns 31.

C.1.33. Government Telecommunications and Informatics Services (GTIS)

The organization that facilitates the secure exchange of information, via the internet, between organizations (RESP providers and ESDC). This organization is under the management of Public Services and Procurement Canada (PSPC).

C.1.34. Grant room

The amount of CESG to which beneficiaries are eligible. Each year that they are eligible to receive the CESG, they accumulate grant room. This applies even if they have not been named as the beneficiary of an RESP.

C.1.35. Group RESPs

RESPs that operate on a pooling principle, through age cohorts, where the beneficiary named under a contract by a subscriber will receive EAPs when enrolled in a qualifying program. The Foundation’s actuary will calculate the contributions to the group plan. The amount and frequency of these contributions usually stay the same as long as the beneficiary has not attained 18 years of age.

Governing rules and requirements may preclude sharing the incentive(s) and/or earnings. Therefore, we recommend that readers refer to the following individual incentive chapters, under the heading related to Receiving and Depositing the incentive:

• Chapter 5. The Canada Education Savings Grant
• Chapter 6. The Canada Learning Bond
• Chapter 7. British Columbia Training and Education Savings Grant
• Chapter 8. Saskatchewan Advantage Grant for Education Savings

C.1.36. Income Tax Act (ITA)

The legislation that governs RESPs – The vehicle used to deposit education savings incentives and save for a beneficiary’s post‑secondary education.

C.1.37. Individual primary caregiver

The person eligible to receive, but not necessarily in receipt of the CCB for a child, as defined under the ITA. This can be the mother, father, grandparent, or a guardian.

C.1.38. Individual RESP

A plan with only 1 beneficiary. That beneficiary may or may not be related to the subscriber and can be over 21 when named as a beneficiary. Since subscribers can open plans for themselves, a subscriber can also be the beneficiary of a non‑family RESP. A subscriber cannot contribute to a plan after the 31st year that follows the year in which the plan was entered into. It is important to note that it could be an earlier date if amounts have been transferred to the plan from an existing RESP.

C.1.39. Information about Programs and Information Holdings (formerly Info Source)

The Information about Programs and Information Holdings (formerly Info Source) is a document published by the Treasury Board Secretariat. It provides a description of government organizations, program responsibilities and classes of records. It provides sufficient clarity and detail to enable the public to exercise its rights under the Access to Information Act. This document is available in libraries, municipal offices and federal government offices across Canada.

C.1.40. Interface Transaction Standards (ITS)

Outlines the procedures for formatting and submitting transactions electronically to the CESP System. The ITS can be downloaded from the ESDC website.

C.1.41. Managed secure file transfer (MSFT)

An Entrust®‑enabled software recognized by ESDC as a secure method of data encryption.

C.1.42. National Child Benefit Supplement (NCBS)

The NCBS (replaced by the Canada Child Benefit (CCB) on July 1, 2016) was a monthly payment issued to modest‑income Canadian families with children. It is part of the CCTB, a non-taxable payment designed to help eligible Canadian families with the cost of raising children. For more information, refer to C.1.12. Canada Child Tax Benefit (CCTB).

C.1.43. Non‑family RESP

Also known as an ESP RESP. For the definition, refer to C.1.38. Individual RESP.

C.1.44. Notional account

Also known as an RESP account. For the definition, refer to C.1.58. RESP account.

C.1.45. Participating RESP promoter

An RESP promoter that is authorized to offer education savings incentive(s).

C.1.46. Post‑secondary educational institutions

Educational institutions, recognized by the CRA, offering qualifying educational programs at the post‑secondary level. Eligible beneficiaries must attend a qualifying program in a recognized post‑secondary educational institution in order to receive EAPs. For more information, refer to C.1.26. Educational assistance payment (EAP).

C.1.47. Primary caregiver (PCG)

A person or organization primarily responsible for the care and upbringing of a child. A primary caregiver (PCG) can be an individual or a public entity. The PCG must provide their information and consent to apply for the CLB and the Additional CESG when the beneficiary is under 18 years old. For more information, refer to C.1.37. Individual primary caregiver and C.1.51. Public primary caregiver.

C.1.48. Privacy Act

The legislation that provides all individuals present in Canada access to federal information about themselves. This legislation specifies how the government can collect, use, disclose, and retain personal information. It requires that government institutions develop and maintain an index of personal information holdings called Personal information banks (PIBs). The Act provides the legal framework for protecting personal information, accessing personal information, data matching, and controlling the use of SINs.

C.1.49. Promoter

The RESP promoter sets up a specimen plan, has it approved by the CRA and enters into contracts (ESPs) with its clients. The promoter is responsible for the registration of the ESPs as well as for the general administration of the RESPs. Promoters include financial institutions, such as banks and credit unions, as well as group plan dealers. They are also referred to as RESP providers. For more information, refer to C.1.61. RESP provider.

C.1.50. Provincial grant

Grant money paid into the RESP under a designated provincial program administered by ESDC. For more information, refer to C.1.62. Saskatchewan Advantage Grant for Education Savings (SAGES) and C.1.9. British Columbia Training and Education Savings Grant (BCTESG).

C.1.51. Public primary caregiver

The child-care departments, agencies, institutions and organizations eligible to receive payments under the Children’s Special Allowances Act for a child in their care. For more information, refer to C.1.19. Child in care.

C.1.52. Qualifying contributions

Contributions made to an RESP that, based on available grant room, have the potential of attracting the CESG if it meets all eligibility criteria. If and when these contributions actually attract CESG payments, we refer to them as assisted contributions. For more information, refer to C.1.4. Assisted contributions.

C.1.53. Qualifying educational program

A course of study that offers credits towards a degree, diploma or occupational skills certificate at the post‑secondary level. The program must last at least 3 weeks in a row, with at least 10 hours of instruction or work each week. Programs at foreign universities must last at least 3 weeks, while programs at all other foreign educational institutions must last at least 13 weeks. Qualifying educational programs include apprenticeships, and programs offered by a trade school, CEGEP, college or university. For more information, refer to C.1.66. Specified educational program.

C.1.54. Receiving RESP provider

The person or organization holding the RESP into which the subscriber transfers the property from another plan. Other RESP documents may use the term “transferee” instead of “receiving”.

C.1.55. Record type (RT)

A data record that exchanged between the RESP provider’s system and the CESP system. There are a series of record types, each identifying a different type of transaction. Definitions of all record types are found in the CESP’s ITS. For more information, refer to C.1.40. Interface Transaction Standards (ITS).

C.1.56. Registered Education Savings Plan (RESP)

An ESP that has been registered with the CRA. It is a savings vehicle used by individuals to save for children’s post‑secondary education. Once registered, the plan becomes the repository for education savings incentive payments made on behalf of an eligible beneficiary. Earnings in the plan are tax‑sheltered. For more information, refer to C.1.25. Education savings plan (ESP).

C.1.57. Reporting periods

The period, extending from the first to the last day of the same month, over which RESP transactions take place. The RESP promoter has 4 business days after the reporting period to send files for processing by the CESP system. They cannot include any transactions that occurred after the last day of the reporting period.

C.1.58. RESP account

For tracking purposes, a separate account that identifies the value of each monetary component of the RESP, including:

• contributions
• earnings
• CESG
• CLB
• SAGES
• BCTESG

Also referred to as a notional account.

C.1.59. RESP promoter

Also referred to as a promoter. To access the definition, refer to C.1.49. Promoter.

C.1.60. RESP property

All assets in an RESP, including contributions, education savings incentives, and earnings.

C.1.61. RESP provider

RESP promoters, trustees as well as service providers that process electronic transactions. For more information, refer to C.1.49. Promoter and C.1.74. Trustee.

C.1.62. Saskatchewan Advantage Grant for Education Savings (SAGES)

Provincial grant introduced by the Government of Saskatchewan in 2013 for eligible children residing in Saskatchewan. Saskatchewan matches 10% of RESP contributions in SAGES amounts, up to $250 per beneficiary for each eligible year. Payments can occur until the end of the calendar year in which a beneficiary turns 17. Total SAGES payments per beneficiary could reach $4,500 if the beneficiary is eligible from birth until age 17.

Note: On March 22, 2017, the Government of Saskatchewan announced that they made the decision to suspend SAGES, effective January 1, 2018, until further notice.

C.1.63. Sending RESP provider

Also referred to as a transferring RESP provider. To access the definition, refer to section C.1.73. Transferring RESP provider.

C.1.64. Siblings‑only family RESP

A family RESP in which every beneficiary is a brother or sister of every other beneficiary.

C.1.65. Spouse

The cohabiting spouse or common‑law partner of the primary caregiver, consistent with the meaning assigned in section 122.6 of the Income Tax Act. If this person separates from the primary caregiver for more than 90 days because of a breakdown in the relationship, they are no longer considered a spouse.

C.1.66. Specified educational program

A program at a post‑secondary school level that is not less than 3 consecutive weeks in duration. It also requires each student taking the program not to spend less than 12 hours per month on courses in the program. For more information, refer to C.1.53. Qualifying educational program.

C.1.67. Specified plan

A specified plan is a single beneficiary RESP in which the beneficiary is:

• an individual who meets the conditions
• is entitled to a disability tax credit

This applies until the end of the year that is the 31st year following the year in which the plan was opened. After the end of the 35th year following the year in which the plan was entered into, a specified plan must not permit another individual to be designated as a beneficiary. Subscribers cannot make contributions to a specified plan after the 35th year following the year the plan was entered into. This excludes transfers from another plan. The subscriber must terminate the plan by the end of the 40th year after the year the subscriber opened the plan.

C.1.68. Subscriber

The individual who enters into an RESP contract with an RESP promoter. The subscriber will also name 1 or more beneficiaries for whom he or she will make contributions. Typically, the subscriber is the child’s parent or parents, but it can also be a grandparent, another family member, or a family friend. A beneficiary can also be the subscriber of their own RESP.

C.1.69. Termination adjustment transaction

Adjustment transactions, submitted by RESP promoters when they terminate a contract. That transaction will inform ESDC of a shortfall (due to losses in the plan) in covering the total grant or bond liability of the contract. ESDC must receive a repayment transaction due to contract termination (transaction type 21) for each termination adjustment transaction. For more information, refer to C.1.71. Transaction type.

C.1.70. Transaction ID

A unique identifier assigned to each transaction by the RESP promoter.

C.1.71. Transaction type

The 2-digit number following the record type (RT), which further categorizes the type of transaction submitted to the CESP system. For more information, refer to C.1.55. Record type (RT).

C.1.72. Transfer transactions

Transactions that record the transfer of funds from 1 RESP to another. The RESP promoter reports those transfers to the CESP system as RT 400‑19 (transfer in) or as RT 400‑23 (transfer out) records. For more information, refer to C.1.55. Record type (RT).

C.1.73. Transferring RESP provider

The person or organization holding the original RESP before they transfer the property (to another plan). Other RESP documents may use different terms instead of “transferring” such as:

• sending
• relinquishing
• originating
• transferor

C.1.74. Trustee

A trust company licensed in Canada to hold funds and hired by the RESP promoter to manage RESP funds. The trustee invests, administers and distributes the money deposited into the RESP as per the promoter’s instructions. In some cases, the same organization acts as both promoter and trustee. For more information, refer to C.1.61. RESP provider.

C.1.75. Unassisted contributions

A contribution made to an RESP for which the CESP system has not paid any CESG.