Q: Is there a fee to open an RESP at AGF?
A: There is no fee to open an RESP at AGF.
Q: Who can be a subscriber to an AGF RESP?
A: For Family RESPs, the subscriber must be related by blood or adoption to all beneficiaries in the account (i.e. parent, grand-parent or sibling). For Individual RESPs, the subscriber can be anyone, even the beneficiary. The AGF Registered Education Savings Plan permits spouses to be joint subscribers. In cases where a beneficiary has a public primary caregiver, the subscriber can be the agency.
Q: My son was 17 when I opened a Family RESP for my two younger children last year. He was not named as a beneficiary at that time because we knew he would not be eligible for the Canada Education Savings Grant (CESG). Is it still possible to add him to the account and have him use the grant proceeds accumulated by his siblings?
A: He can still be added to the account as long as it is before the year in which he turns 21. He would have access to grant proceeds, as grant monies are shared in a Family RESP.
Q: What are the criteria to be eligible for the CESG?
A: To be eligible you must:
Q: Are 16 and 17-year-old beneficiaries eligible for the CESG?
A: Beneficiaries who are turning 16 and 17 in the current calendar year are eligible if one of two conditions is met:
Q: I have two children, but only opened an RESP account for the oldest child. If he doesn't go to school will the grants have to be repaid to the government?
A: If the grants are not used for educational purposes, they will have to be repaid. However, you can replace a beneficiary provided that the replacement beneficiary is a sibling of the original beneficiary (if the original RESP is an Individual plan). Alternatively, if the original RESP is a Family plan, you can add the younger child to the plan. The grants do not have to be repaid in these situations and can be used by the younger child when they enrol in a post-secondary institution.
Q: Is there a limit on the amount of Educational Assistance Payments (EAPs) a beneficiary may receive?
A: The total of all EAPs that can be made to a beneficiary before he or she completes the first 13 consecutive weeks in a full-time qualifying educational program is limited to $5,000. Once this period is completed, the beneficiary can receive any amount of EAPs. Students requiring more than $5,000 in EAPs may apply to ESDC for permission to receive larger EAPs. Part-time students are limited to $2,500 in each 13 week period of enrolment in a qualified post-secondary institution. The CESG lifetime limit is $7,200 per beneficiary.
Q: How many years can the beneficiary who attends a qualified post-secondary institution receive EAPs?
A: According to the Income Tax Act (ITA), there are no specific restrictions on the number of years a beneficiary may attend post-secondary educational institution and receive EAPs. However, each RESP must be terminated no later than the 35th year after the year in which the original plan was opened.
Q: Can a subscriber transfer from one RESP to another RESP?
A: Subject to the terms of the plan, partial or full transfers are permitted under the Income Tax Act. The transfer of an amount from an RESP to another RESP can be made without resulting in any penalty tax in two cases:
If the originating plan was opened earlier than the receiving plan, this earlier date will become the new effective plan open date of the receiving plan.
Special conditions apply for transfers of grant and bond monies.
Q: What happens on the death of a subscriber?
A: A subscriber can provide in their will, for their estate to continue the RESP, which would allow the beneficiary to receive payments from the plan while attending post-secondary school.
The subscriber can also name another individual in his/her will, as an alternate subscriber. The alternate subscriber would take on responsibility for the RESP and can name new beneficiaries, etc. after death of the original subscriber. In a family plan, the blood or adoption relationship will be in effect for any new beneficiaries that are named to the plan (i.e. the new beneficiary must be related by blood to the alternate subscriber and all other beneficiaries in the plan).
For answers to other frequently asked questions about RESPs please visit the CRA Registered Education Savings Plan FAQs.