An RESP offers 2 different payment options:

• Educational Assistance Payments (EAPs)
• Payments of contributions to a beneficiary (PSE) or subscriber (Capital)

Educational Assistance Payments (EAP)

Definition: An Educational Assistance Payment withdrawal is the payment of RESP earnings and CESG amounts to a beneficiary to help finance the cost of post-secondary education in Canada or outside Canada. For the purpose of an EAP, a qualifying educational program is identified as follows:

Qualifying for an EAP:

• Full-time studies: a program must last at least three consecutive weeks and requires at least 10 hours of instruction or work each week.
• Part-time studies: a student must be at least 16 years old and the program must last at least three consecutive weeks and requires at least 12 hours of instruction each month.

EAP limits:

EAP checklist:

• A completed EAP form or letter of direction listing the following information:
  1. Mackenzie account number
  2. Fund(s) name or number
  3. Dollar amount or percentage split (per fund)
  4. Dealer/Advisor codes
  5. Payment type (cheque made payable to client, beneficiary or educational institution OR EFT deposit to client or beneficiary bank account)
  6. Academic Year Start Date and the total number of weeks in the academic year
  7. Program type (University, College, etc.)
  8. Program length
  9. Program year in which the student is enrolled
  10. Signature guarantee for request over $25,000.00
  
  
• Current proof of enrollment in a qualifying education insitution (must be submitted within 6 months of the completion of the qualifying program). For proof of enrollment guidelines, please click here.
• Void cheque (if electronic deposit is requested).

Tax Implications

A T4A/Relevé 2 tax receipt for the total grant and earning paid will be issued to the beneficiary.

Payments of contributions to a Subscriber or Beneficiary

1. Post Secondary Educational (PSE) withdrawals
2. Capital withdrawals

Post Secondary Educational (PSE) withdrawals

A Post Secondary Educational withdrawal is the payment of RESP contributions to a beneficiary to help finance the cost of post-secondary education. A valid proof of enrollment is required but there is no limit on the dollar amount or frequency of the withdrawals.

Capital withdrawals

There is no limit on the dollar amount and frequency of the withdrawals. Capital withdrawals are not taxed therefore no receipts are issued.  If both Assisted  (contributions that have received CESG) and Unassisted contributions (contribution that have not received CESG) have been made into an RESP, Assisted contributions will be redeemed first as the corresponding grant received needs to be repaid to HRSDC.