November 2022 – 15 min read
If your child is getting ready to attend post-secondary school, now’s the time to start thinking about withdrawing money from your Registered Education Savings Plan (RESP)Opens in a new window.
Withdrawals can be used to pay for allowable expenses, such as tuition, living expenses and food.
If your child chooses not to pursue post-secondary educationOpens in a new window, make sure to think about what to do with the money saved in your RESP.
When it comes to taking money out, there are some important things you should know to help you get the most from your investment. Here’s an overview of things to consider when making a withdrawal from your RESP savings.
The money or assets in an RESP account is controlled by the subscriber (the person who set up the plan). Only the subscriber can request payments from the account – and not the beneficiary (the student).
The withdrawal can be used to pay for a range of eligible expenses, and can include things like tuition, textbooks and living expenses. Your RESP provider may be able to provide you with list of allowable expenses.
To make a withdrawal you’ll need to contact your RESP provider. They will require proof that the student is attending a qualified post-secondary educational program on a full or part-time basis. A qualifying educational program is a:
Full-time post-secondary course of study in Canada that lasts at least 3 weeks in a row, with at least 10 hours of instruction or work each week.
Full-time program at a foreign educational institution that lasts at least 13 weeks and is at a post-secondary level
Part-time educational program at post-secondary school level that lasts a minimum of 3 consecutive weeks, and that requires a student to spend not less than 12 hours per month on courses in the program.
Qualifying programsOpens a new website in a new window may include apprenticeships and programs offered by a college, university, trade school, or other institutions as certified by the Minister of Employment and Social Development Canada.
How much can you withdraw from an RESP?
If the beneficiary is undertaking full-time studies, the maximum Educational Assistance Payment (EAP) withdrawal amount is $5,000 during the first 13 consecutive weeks of enrollment.
After this, you can request withdrawals of any amount with no limit – unless your child takes a break from studies and doesn’t re-enroll within 12 months.
What to do with an RESP if your child doesn't go to college or university
Although many parents want their children to go to college or university, not everyone’s future involves a post-secondary campus.
These days, there are plenty of opportunities available to people who take a different path.
If you discontinue the RESP, grants awarded through the Canada Education Savings Grant (CESG)Opens in a new window and Canada Learning Bond (CLB)Opens in a new window will be returned to the federal government, and you’ll have to pay tax on any investment growthOpens in a new window on your contributions. Other options include naming another beneficiary or moving the money to a registered retirement savings plan (RRSP)Opens in a new window or registered disability savings plan (RDSP)Opens a new website in a new window.
For more information on RESP withdrawal rules and options, visit the Government of Canada websiteOpens a new website in a new window.
The information provided is based on current laws, regulations and other rules applicable to Canadian residents. It is accurate to the best of our knowledge as of the date of publication. Rules and their interpretation may change, affecting the accuracy of the information. The information provided is general in nature, and should not be relied upon as a substitute for advice in any specific situation. For specific situations, advice should be obtained from the appropriate legal, accounting, tax or other professional advisors.