CESG – Canada Education Savings Grant

CESG – Canada Education Savings Grant is paid directly into your child’s RESP.

To help you save for your child’s education after high school, the Government of Canada will add to your savings in a Registered Education Savings Plan (RESP) with a Canada Education Savings Grant (CESG).

For children 15 years old and older, prior RESP contributions must have been made before December 31 of the year in which the child turns 15.

The Amount of the CESG

On the first $500 you save in your child’s RESP, the Canada Education Savings Grant will give you:

• 40 cents per dollar, if your net family income is $37,178 or less.
• 30 cents per dollar, if your net family income is between $37,178 and $74,357.
• 20 cents per dollar, if your net family income is more than $74,357.

No matter what your net family income is, when you save more than $500, the Canada Education Savings Grant will give you 20 cents for every extra dollar, up to $2,500.

Steps to Getting the CESG

To get the CESG, all you need to do is:

• Apply for a Social Insurance Number (SIN) for your child. There is no fee to get one, however, certain documents are required. Contact 1 800 O-CANADA for more information or visit a Service Canada centre near you.
• Apply to the Canada Revenue Agency for the Canada Child Tax Benefit (CCTB), if your family net income is $74,357 or less. This form is generally provided at the hospital where your child was born.
• Choose the RESP provider that best meets your needs. (RESP providers include most financial institutions, such as banks or credit unions, as well as group plan dealers or financial services providers.)
• Open an RESP for a child.
• Put some money in your RESP.
• Ask your RESP provider to apply for the CESG on behalf of the child.

The grant money will be deposited directly into your child’s RESP.

Lifetime CESG Limits

The most CESG your child can receive is $7,200. This lifetime limit also applies to each individual child when the CESG money is shared with other beneficiaries as in a family RESP.

In this case, lifetime means from birth up to the end of the year that the child turns 17 years old.

Using the CESG

As soon as your child is enrolled in a qualifying educational program, he or she can start receiving money from the RESP. At that time, the CESG along with income earned by the money in the RESP is paid to the beneficiary as an Educational Assistance Payments (EAPs). Each EAP includes a specific amount of the CESG.

If your child does not go on to education after high school, the CESG must be returned to the Government of Canada, unless the RESP is a family plan. If the RESP is a family plan, the CESG may be used by another eligible child named in the plan. That child may use an amount of the CESG up to his or her lifetime limit as described above.