Can RESP be used for housing?
RESP money can be used to pay for any education-related costs once you’ve provided proof of enrollment in a qualifying program. … Other eligible expenses may include rent, meals, living expenses, a laptop or tablet, a desk and student fees.
Can you buy a house with RESP money?
RESPs are not the only way to invest for future education. … The money can be used to start a business, buy a house, used for travel after school or for education. Quite frankly, it can be used for anything.
What can RESP withdrawals be used for?
When you withdraw government payments or interest earned from an RESP account, that money is called an Educational Assistance Payment. … You can use this money to pay for post-secondary school expenses like tuition, books and transportation. Note: Educational Assistance Payments only include the interest and the grants.
Can I withdrawing from RESP for non educational purposes?
Can I Withdraw From An RESP For Non-Educational Purposes? Yes. But there are consequences. Aside from the tax hit and the penalty, you return any government-contributed funds in the RESP, in full.
Can parents withdraw from RESP?
The money in an RESP is not forgone if a child doesn’t go to college or university right away, or at all. … Family RESP accounts allow money to be shifted from one beneficiary to another quite easily. You can withdraw your original contribution amounts tax-free at any time.
Do you get a tax slip for RESP?
They’ll receive a tax slip with the amount of income related to the RESP to claim on their income tax return. As parents, you won’t need to claim any income related to the RESP on your tax return. … Your daughter or son should receipt a tax slip with the amounts to report on their taxes for the RESP.
Should I borrow RESP money?
Maximize your contributions with the RESP Loan
The RESP Loan can help you contribute more to your child’s RESP and take full advantage of generous government grants, without going over budget. … The more you contribute to your RESP, the more you receive in grants, up to an annual maximum.
What happens if you don’t use your RESP?
Here’s what happens to the money in the RESP: Contributions – Your contributions are returned to you. You don’t have to pay tax on any contributions that are withdrawn. … The plan subscriber has to pay tax on any investment earnings taken out of the plan, plus a 20% penalty.
Who gets taxed on RESP withdrawal?
Money paid out of the RESP as an Educational Assistance Payment is taxed in the hands of the student. Since many students have little or no other income, they can usually withdraw the money tax-free. The money that you have put in the RESP is returned to you, tax-free.
How much money can you withdraw from RESP per year?
Maximum RESP withdrawal
There is a $5000 limit (or $2500 if the student is enrolled part-time) on EAP contributions during the first 13 weeks of schooling. There is no limit on the amount of Subscriber (PSE) contributions that can be withdrawn.
What is a qualifying educational program?
A qualifying educational program is a course of study that lasts at least three weeks in a row, with at least 10 hours of instruction or work each week. … Qualifying educational programs include apprenticeships and programs offered by trade schools, CEGEPs, colleges, or universities.