Canada Education Savings Grant (CESG) – After applying
5. After applying
How long it will take to process the application
The application must be complete and accurate to avoid delays. Once accepted, the Government of Canada will deposit the CESG in the Registered Education Savings Plan (RESP) within 65 days of a contribution.
Grant room (carry forward)
Until the year of their 17th birthday, children qualify for $500 in CESG if they are:
- a resident in Canada
- born after 1998
The child can get more than $500 of CESG per year, up to a maximum of $1,000, under certain circumstances. The subscriber can carry forward the unused amount of CESG from previous years by contributing more than $2,500 per year. This way, a child could get up to $1,000 in CESG per calendar year if there are unused amounts from previous years.
For example, a subscriber may decide not to contribute for a period of one year. In this case, the unused amount of CESG for that period can be carried forward for use in future years. Once contributions begin again, the subscriber may decide to contribute $5,000 to the RESP in a given year. As long as the lifetime CESG limit is not exceeded, the CESG room can be carried forward. In this case, the amount of CESG paid will be $1,000. If eligible, the same contribution may attract an extra $100 in the Additional amount of CESG.
If a child is named as a beneficiary in more than one plan
CESG payments happen on a first-come, first-served basis, subject to annual CESG and lifetime CESG limits.
For example, if two subscribers make contributions in the same month to two separate RESPs, the RESP with the subscriber's contribution dated earliest in the month will get the CESG. If the contributions are made on the same day, the CESG will be pro-rated (split proportionately).
It is important for subscribers to let each other know about their contributions. This will maximize the yearly CESG room, while respecting the lifetime contribution limit of $50,000.
If a child does not continue education after high school
If a child does not continue their education immediately after high school, the RESP can stay open up to the end of its 35th year (or up to 40 years for a specified plan). The funds must be used and the RESP must be terminated on or before the 35th year of the plan.
If a child does not continue their education after high school and the RESP is closed:
- any amount contributed to the RESP goes back to the subscriber
- the Canada Learning Bond and the CESG go back to the Government of Canada
Accumulated interest earned in the RESP can be:
- paid to the subscriber and taxed
- transferred to a Registered Retirement Savings Plan of the subscriber or the subscriber’s spouse
- transferred to a child’s Registered Disability Savings Plan
- gifted to a designated educational institution
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