education savings
Loopholes Tagged "education savings"
Plain-English guides to Canadian legal rights and workarounds related to education savings.
Canada Learning Bond — Get Up to $2,000 in RESP Money Without Contributing a Dollar
The Canada Learning Bond can deposit up to $2,000 into an RESP for eligible low-income children and youth, and no personal contribution is required to receive it.
RESP Government Grants — Collect Up to $7,200 in Free Federal Money for Education
The federal government automatically adds 20% to RESP contributions — up to $500 per year per child in free grants, with a lifetime maximum of $7,200.
RESP Educational Assistance Payment Taxation — Have the Student Pull the Taxable Portion
When RESP money is withdrawn as an Educational Assistance Payment, the taxable income usually lands on the student rather than the parent, which often means little or no tax.
RESP-to-RRSP Conversion (Accumulated Income Payment)
If a child doesn't pursue post-secondary education, RESP subscribers can roll up to $50,000 of accumulated income directly into their RRSP — tax-deferred — avoiding a hefty penalty tax, provided they have available RRSP room.
RESP Accumulated Income Payment to RRSP — Move Excess RESP Earnings Without the 20% Penalty Tax
When an RESP has excess income and education plans collapse, some accumulated income payments can be rolled to the subscriber's RRSP instead of being taxed at regular rates plus the extra 20% tax.