About Registered Education Savings Plans (RESPs)

A registered education savings plan (RESP) is a contract between a subscriber and a promoter (banks, trust companies and scholarship funds) and is a tax-deferred way to save for a beneficiary's post-secondary education. Contributions made by the subscriber are not tax deductible but earnings on such contributions are held in a tax-exempt trust. Contributions may also be eligible for Canada Education Savings Grant (CESG) payments. Investment earnings on contributions and CESG payments grow tax-free until they are distributed and included in the recipient's income and taxed accordingly.

Before marketing an education savings plan, the Registered Plans Directorate must be provided with a specimen of the arrangement. The documents are reviewed thoroughly for compliance with the Income Tax Act.

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