How does the CESG work?

• The grant is paid directly into the RESP by the federal government.
• Grant room accumulates from the year the child is born until a specified age.
• Carry-forward allows more than one year of basic grant in a single year, subject to the annual maximum.
• Grant must be repaid if the plan is collapsed without eligible education use.
• Eligibility requires a valid Social Insurance Number and Canadian residency for the beneficiary.

The basic grant applies to all eligible beneficiaries regardless of family income. An additional amount applies to the first portion of annual contributions for families below defined adjusted-income thresholds. Thresholds are indexed and published each year by the federal government.

Because grant room accrues annually and there is a per-year cap on how much can be received, starting early generally allows a family to collect the full lifetime grant. Waiting until a child's teenage years usually means some grant room cannot be used, since there is also an age limit for eligibility.

If the RESP is collapsed and no beneficiary pursues eligible post-secondary education, grants are returned to the government. Contributions come back to the subscriber; accumulated income may be taxable with additional tax unless transferred to an RRSP where contribution room exists.

• Grant percentages, annual caps and income thresholds are set by legislation and change over time.
• Use the federal education savings estimator to check current figures.
• Group scholarship plan rules can affect grant timing and refunds.

• Canada Education Savings Grant — Employment and Social Development Canada
• Registered Education Savings Plans and education savings incentives — Government of Canada
• Savings and pension plans — RRSP, TFSA, RRIF, RESP — Government of Canada