The Government of Canada has made some recent changes to the Registered Education Savings Plan (RESP) withdrawal and account holder requirements. The RESP is an investment account designed to assist Canadian parents/grandparents in saving for a child’s post-secondary education.

The amount of money that can be withdrawn from the Education Assistant Payment (EAP) portion of the plan within the first few weeks of the student’s post-secondary education program has been increased. The EAP portion is an accumulation of investment earnings and government grants.

What does this mean for you?

As of now, students enrolled in a qualifying post-secondary educational program will be happy to know:

● The amount that can be withdrawn as an EAP during the 12-month period for full-time students in their first 13 consecutive weeks of enrollment has increased from $5,000 to $8,000.

● The amount that can be withdrawn as an EAP during every 13-week period of enrollment for part-time students has increased from $2,500 to $4,000.

Additional Changes to RESP Account Rules:

● Under the 2023 federal budget, divorced or separated legal parents of a Beneficiary can now open joint RESPs for one or more of their children, or transfer their existing joint RESP to another financial institution.

If you have any further questions on these RESP changes, please don’t hesitate to contact us.

Have a great weekend,

Tracey and Paige

Source: https://www.canada.ca/en/revenue-agency/services/tax/registered-plans-administrators/bulletins/resp-bulletin-1.html

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