Heritage Education Funds is one of Canada's leading fixed-income Registered Education Savings Plan ("RESP") providers. Since 1965, Heritage Education Funds has been helping hundreds of thousands of families save for their Beneficiaries' post-secondary education. To date we have helped more than 400,000 Canadians save for the post-secondary education of their Beneficiaries.

The Heritage Educational Foundation was created to support the cultural and environmental education of our community. The Foundation provides resources to help students and parents pursue their post-secondary education goals through the help of the Heritage Educational Foundation's Council. The council includes notable representatives from Canadian associations, government parties, and businesses. The council is proud to share the same belief that higher education is important for sustaining the integrity of Canadian communities.

An RESP is an education savings plan registered under Canada's Income Tax Act, which is established for the purpose of providing financial assistance to a Beneficiary (usually a child) when he or she pursues a post-secondary education. Income on savings within an RESP grows tax-free until the child is ready for post-secondary education. The earnings are taxed in the hands of the student/Beneficiary, who typically pays little to no tax. In addition, RESPs may qualify for various government incentives that help parents, relatives and friends save for a child's post-secondary education. Subscribers and Beneficiaries enrolled in an RESP must have a valid Social Insurance Number. A Beneficiary must be a Canadian resident when the RESP is opened and every time a contribution to an RESP is made.

One of the easiest and best ways to help fund your Beneficiary's future post-secondary education is with a Heritage Registered Education Savings Plan. It is easy to get started and there are different ways to do so:

• You can conveniently submit your request on-line by contacting us here.
• You can call your Heritage Representative to discuss your education savings objectives.
• To find a RESP rep in your area, click here and locate one of our RESP experts conveniently located near you.
• Alternatively, you may call our Customer Service Team locally at 416.502.2500 or toll free at 1.800.739.2101

Whichever way you contact us, we will help you set up a Plan that suits your financial needs and meets your Beneficiary's future education objectives.

The rising cost of education is not a surprise for parents, grandparents, family members and friends that are saving for a child's post-secondary education. In fact, it is estimated that a 4-year undergraduate program at a Canadian university could cost over $158,000 in the year 2031.* Many parents have decided to invest additional funds in an RESP for their children. You can do it too!

If you are interested in adding to your RESP, there are different ways to do so:

• You can conveniently complete the contribution form online. Just log into your secure Subscriber area
• You can call your Heritage Representative to arrange a review of your education savings goals, and your rep will advise you on what additional RESP contributions will help you meet those goals.
• You can call our Customer Service Team locally at 416.502.2500 or toll free at 1.800.739.2101 or contact us online

By contributing a little extra to your RESP, you could significantly increase the aid that you provide your Beneficiary when he/she is ready for post-secondary education.

*Source: Estimation based on Statistics Canada information.

Absolutely! As you know our business depends on people like you. We are interested in helping people who care about their children's future and who want to help them be successful in life. We appreciate your help with introducing parents you know to Heritage RESPs. We encourage you to provide them with the contact information of your Representative or direct them to visit our website at www.HeritageRESP.com.

Heritage RESPs fall into a special category of education savings plans. Government regulations limit the type of investments that can be held in the plans to those that are lower risk investments. We don't hold any investments in stocks and mutual funds which often involves higher risk to your principal. Most of the Heritage RESPs portfolio is invested in government bonds. In fact, almost 80% of our Subscribers' savings are invested in bonds backed by federal, provincial or municipal governments. The remainder of the portfolio is invested in GIC's, bank deposits, short term investments or principal protected notes which feature a principal guarantee.

At Heritage, we understand that, unlike saving for retirement or paying off a mortgage, you usually have less than 18 years to save for a child's post-secondary education. Also, the money will be used up in a relatively short time (a maximum of 4 years in most cases). So it's much more important that your money be invested where it will be exposed to lower risk, and available when you need it. That's why Heritage RESP contributions, as well as the interest earned on contributions, are placed in lower risk fixed and variable rate securities to maximize your returns and minimize overall risk.

Yes, it is. Depending on your pay-out option selection at Maturity, an amount equal to 25%, 50% or 100% of your Membership Fee may be returned to Beneficiaries with the Educational Assistance Payments (EAPs). You will not be eligible for a return of the Membership Fees if you select the Self-Determined Option.

Historically, the Foundation has always maximized EAPs with a refund of the applicable portion of Membership Fees, attrition* and payments from the Enhancement Fund. For example in each of the last 5 years, an average of approximately 15% of the EAP amount came from attrition and payment from the Enhancement Fund. The Foundation's general policy, established practice and future intentions are to provide for discretionary payments to maximize EAPs and to ensure ongoing long-term sustainability of enhancement payments.

The return of Membership Fees and payments from the Enhancement Fund are discretionary payments. Discretionary payments are not guaranteed. You should not count on receiving a discretionary payment. The Foundation decides if it will make a discretionary payment in each year and how much the payment will be.

*Attrition is the term that applies to the share of pooled income that remains in the Heritage Plans, after any Beneficiaries in the same group as your Beneficiary, do not qualify for payments. For those Beneficiaries, the Principal is returned to the Subscriber, but the income that was earned on the Principal stays in the total asset pool, to be shared by Beneficiaries remaining in the pool. Please refer to the Heritage Plans' most recent prospectus for the attrition rates of the past five (5) years.

The Closing Balance statement of account includes the addition of Interest allocation, your Contributions and Government Grants; and the deductions of Membership Fees, Depository Fees, Insurance Premiums (if applicable) and Canada Learning Bond Admin Fee (if applicable).

• There is a difference between your Closing Balance and your Total Contributions because the Closing Balance includes the addition of Interest allocation, your Contributions and Government Grants; and the deductions of Membership Fees, Depository Fees, Insurance Premiums (if, applicable) and Canada Learning Bond Admin Fee (if applicable).
• If you opened your Education Savings Plan recently, the Closing Balance amount on your Statement may indicate zero. You will see on your Statement of Account that the Membership Fees are currently being deducted from your early contributions. When you join the Plan, there is a one-time upfront Membership Fee of $100 per Unit. With Lump Sum plans the fee is deducted from the one time contribution. With Monthly and Annual plans the fees are deducted through your early contributions. Once 50% of your Membership Fee is paid, *half of the remaining contributions will be applied to cover the rest of the Membership Fee and half will accumulate as Principal and will work to maximize your savings and interest potential. In addition, your RESP attracts available government grants and earns interest on those grants providing we have the Beneficiary's SIN on file.
• Collection of Membership Fees is different from other available RESP products offered by the banks where the Management Expense Ratio (MER) is charged annually for as long as you hold the fund. This MER is not refundable under any circumstances while your Heritage Plans RESP offers a unique opportunity that may provide a refund of all or a portion of the Membership Fees with the Educational Assistance Payments (EAPs).

If you did not provide your Beneficiary's Social Insurance Number (SIN) within 24 months at the time of enrollment, your contributions were placed in an Escrow account awaiting the Beneficiary's SIN. If you provided your Beneficiary's SIN in 2012, we transferred the balance of your Escrow account into the new registered account that same year and treated the transfer as a new transaction with the opening balance of zero as per requirements of Human Resources and Skills Development Canada (HRSDC).

For an Education Savings Plan to be registered under the Income Tax Act (Canada), a Beneficiary must have a valid SIN. If the Beneficiary's SIN is not provided at the time of enrollment, contributions will be deposited in an interest bearing, segregated Escrow account held in trust on behalf of the Subscriber. While in Escrow, contributions are not eligible for the tax benefits of an RESP or government grants. If the SIN is not provided within 24 months, your contributions (less fees) will be refunded, together with any interest earned.

The Beneficiary's SIN must be provided within 24 months of the date of acceptance of the Subscriber's Application. As long as the SIN is provided within 24 months, and the completed incentives form is received, the Foundation will apply on the Subscriber's behalf for registration of the Plan and applicable government grants and incentives.

Interest allocation in your Statement is based on the net balance in your account including any interest already earned (after all deductions are made). Interest on Government Grants is calculated on the full amount of Grants less the $25 Canada Learning Bond Administration Fee (if applicable).

• If you opened your RESP in 1998 or later and haven't collected any grant money yet, you are entitled to a maximum of $400 for each year you missed, up to and including the year 2006. Effective January 1, 2007, the maximum entitlement increased to $500 per eligible Beneficiary per year (subject to an annual CESG limit of $1,000).
• If you can't make your RESP contributions for one or more years, you're still entitled to receive CESG payments for those years. For instance, if you stop making RESP contributions for two years and then start contributing again, you may be eligible for an amount of CESG that would have been allocated for the years in which the payments were not made. This applies to Basic CESG only; Additional CESG is not carried forward.
• Please note: for any contributions made before December 31, 2004, the deadline to apply for the Basic CESG is no later than December 31, 2007. Any contributions made from January 1, 2005, onward, you must apply for the Basic and/or Additional CESG within three years of the date you made the contributions.
• CESG payments and interest will be paid to the student as part of the Educational Assistance Payment(s) (EAPs) beginning in their second academic level of an eligible post-secondary program.

When Subscribers open a RESP plan for a Beneficiary, they purchase units based on the contributions that they are willing to make – each unit has a cost respective to the Beneficiary's age. The EAPs are made on a per unit basis when the Beneficiary attends 2nd, 3rd, and 4th year of post-secondary studies – the higher the number of units purchased, the higher the payment available to the Beneficiary. Consequently, EAPs may cover a potion of costs associated with post-secondary education but may not necessarily cover all costs incurred as the payments depend on the number of units purchased by the Subscribers, number of Beneficiaries applying for EAPs, fluctuation of market returns and the amount available for payment on a per unit basis.

Your savings will be released during the first two weeks in August of the maturity year under either option, as long as all required documentation has been received by Heritage.

Yes. If a Scholarship Option is selected prior to maturity, the Plan will continue to earn interest which will be transferred to the Scholarship Pool and shared by all the Beneficiaries who have the same Year of Eligibility. This may not directly enhance the EAP received by your Beneficiary.

If the Self-Determined Option is selected at maturity, the Plan will continue to earn interest which will be available to the Beneficiary or the Subscriber(s) when a request to release the interest is made.*

*Certain conditions apply. See prospectus for full details.

An AIP may only be transferred into the RRSP of an original subscriber or common-law partner of a deceased original subscriber (if there is no other subscriber) tax-free. If you wish to transfer the funds into your Beneficiary's RRSP, you must withdraw the AIP as a cash payment, which can then be transferred into an applicable RRSP (provided there is contribution room available). Please note: An AIP cash withdrawal is subject to two different taxes: the regular income tax and an additional federal tax of 20% (12% federal and 8% provincial for Quebec residents).

Your RESP contributions, government grants and income earned are invested in lower-risk, fixed or variable securities like Guaranteed Investment Certificates, Federal and Provincial Bonds, Corporate Debt Securities, Term Deposits, Government Treasury Bills, Mortgage-backed securities and principal protected notes that earn a consistent and competitive return.

It is a regulatory requirement for all investment companies to calculate and provide their market returns. The market returns for the Heritage Plans as at December 31, 2012 are: 1 year – 4.16%, 3 year – 5.92%, 5 year - 5.46% and 10 year – 5.72%. The market returns are based on the market values and the time-weighted cash flows during the reporting periods. These returns include the realized gains and losses as well as the unrealized gains and losses.

 

• Currently, realized gains and losses are allocated to the pool of Beneficiaries with the same year of eligibility. This allocation consists of interest earned, realized gains and losses and income earned on realized gains.
• Though the realized gains are allocated to the pool of Beneficiaries, they will be allocated to the individual Beneficiaries when the Educational Assistance Payments (EAPs) are made.

 

The allocation of interest to the individual Subscribers consists of income earned from the investments less the applicable fees and realized gains. To be exact, we do not allocate a rate but a dollar amount. For example, if the Heritage Plans earn $1 million in investment income, this amount is prorated to all Subscribers in proportion to the beginning value of their Plans, which includes both principal and interest. When the calculation is done it works out to a different rate than the market returns.

For the Heritage Plan RESPs, fees paid by the Subscribers are listed below:

 

• A $100 per unit Membership Fee is deducted from early contributions, of which all or part may be returned with the Educational Assistance Payments (EAPs), depending on the Scholarship Option chosen.*. Membership Fees are not refundable if you cancel your Plan or transfer to another financial institution prior to Maturity.
• A Depository Charge of between $3.50 and $10.00 (plus applicable taxes). The amount of this fee depends on the contribution method selected (monthly, annual or one-time) and is deducted from Savings on a quarterly basis.
• A portfolio management fee equal to .05% to .20% per annum of the average market value of assets in the Plans (.055% in 2011).
• An administration fee equal to .50% annually of Principal, Income and CESG, CLB, QESI and/or ACES and interest thereon in the Deposit Account and, with respect to Subscribers who have selected the Self-Determined Option, of Principal, Income, CESG, CLB, QESI and/or ACES and interest thereon in the Self-Determined Account.

 

* The refund of Membership Fees is a discretionary payment. Discretionary payments are not guaranteed. You should not count on receiving a discretionary payment. The Foundation decides if it will make a payment in any year and how much the payment will be.

If you opened your Heritage Plans RESP prior to July 2004, and depending on the Scholarship Option you choose upon maturity of your Plan, you will receive all or a portion of the Membership Fees returned along with your principal. They are returned at 100%, 50% or 25% dependant on the payout option selected.

If you opened your Heritage RESP after July 2004, all or a portion of the Membership Fees may, at the discretion of the Foundation, be returned to the Beneficiary at the time the Educational Assistance Payments (EAPs) are paid out. Membership Fee amounts, if returned, are distributed evenly with EAPs and are returned at 100%, 50% or 25% depending on the payout option selected.*

If you decide to withdraw from the Heritage Plans prior to the Maturity Date or select the Self-Determined Option within 180 days before the Maturity Date, you will no longer be eligible for a refund. Furthermore, if you make a financial adjustment to your plan that reduces the number of units initially purchased, the applicable Membership Fees for the cancelled units will be lost unless the units are reinstated within the timelines stipulated in the Prospectus.

* The return of Membership Fees is a discretionary payment. Discretionary payments are not guaranteed. You should not count on receiving a discretionary payment. The Foundation decides if it will make a payment in any year and how much the payment will be.

Yes, the child (Beneficiary) will be responsible to pay regular tax on the EAPs received. Since the income tax bracket is typically very low for the Beneficiary, he/she may not be taxed as much for the amounts received. A T4A slip will be mailed in February of the year following the EAP payment enabling the Beneficiary to file for the taxes applicable.

Principal returned to you, the Subscriber, is not included in your taxable income. The EAP payments to the Beneficiary are taxable to the Beneficiary. Under the Self-Determined Option, if the Beneficiary does not pursue post-secondary studies and the Subscriber(s) withdraws the interest accrued in cash, they will be required to pay the regular tax on the amount received plus an additional federal tax of 20% (12% federal and 8% provincial for Quebec residents) to the Government.

Yes, your Beneficiary may receive EAPs even if he/she studies abroad. There will be an additional tax of up to 25% applicable on each EAP withdrawal if your Beneficiary is not a Canadian resident at the time the EAP is paid. To determine if there are any other tax implications, you may want to contact your local accountant or the Canada Revenue Agency (CRA) at 1.800.267.5177.

Introduced in January 1998, the Canadian Education Savings Grant (CESG) is a special financial incentive by the federal government for parents, family and friends to save for a child's education after high school. It provides people who invest in an RESP with a Basic Canadian Education Savings Grant amount equal to 20% of yearly contributions, up to an annual maximum of $500 per eligible Beneficiary, with a lifetime maximum of $7,200.

Effective January 2005, your Beneficiary may be eligible to receive additional CESG if the primary caregiver* applies for the Canada Child Tax Benefit (CCTB) and your net family income is:

Net Family Income	Basic CESG	Additional CESG	Maximum grants receive
$43,561* or less	20%	20% on your first $500 annual contribution	$500 Basic + $100 Additional = $600
Between $43,561 and $87,123*	20%	10% on your first $500 annual contribution	$500 Basic + $50 Additional  = $550

*This amount is indexed each year based on the rate of inflation.

*Primary caregiver is the person who is primarily responsible for the care and upbringing of a child.

Depending on your family income, your Beneficiary could receive additional funds in the form of additional Canadian Education Savings Grant (CESG):

• If your net family income is below $43,561*, the grant will be 40% for every dollar on the first $500 you save and 20% of the next $2,000 in your Beneficiary's RESP each year. That means you could receive up to $600 in CESG per year.
• If your net family income is between $43,561* and $87,123*, the grant will be 30% for every dollar on the first $500 you save and 20% of the next $2,000 in your Beneficiary's RESP each year. That means you could receive up to $550 in CESG per year.

Please note that no matter which Canadian Education Savings Grant formula you qualify for, the lifetime limit for each Beneficiary remains at $7,200.

*This amount is indexed each year based on the rate of inflation.

To apply for a CESG follow these simple steps:

1. Register the birth or adoption of the child.
2. Apply for a birth certificate for the child.
3. Apply for a Social Insurance Number (SIN) for the child. You can download the SIN application form here.
4. Open a Registered Education Savings Plan (RESP) and make a deposit.
5. Download the appropriate form for your CESG application:

 

• • • If you are a parent and/or legal guardian and are contributing to your child's RESP, download form HRSDC 0073 E
    • If you are a grandparent, aunt, uncle or non-relative and are contributing to a child's RESP, download form HRSDC 0071 E (The original form must be forwarded to the RESP promoter)

 

There is a special rule for older Beneficiaries. In order to receive CESG* when the Beneficiary is 16 or 17 years old, at least one of the following conditions must be met:

• A minimum of $2,000 of contributions must be made and not withdrawn in any year before the Beneficiary is 16 years old
• A minimum of $100 of annual contributions must be made and not withdrawn in at least any four years before the Beneficiary is 16 years old

* Certain conditions apply. See prospectus for full details

Families with children born in 2004 or later whose parent or guardian receives the National Child Benefit (NCB) Supplement qualify for the CLB. To receive NCB Supplement the family must have less than $43,561* net annual income.

The Canada Learning Bond provides a one-time initial grant payment of $500 to an eligible Beneficiary's Registered Education Savings Plan. If the parents or guardians continue to qualify and receive the NCB Supplement, the government will also provide an additional $100 for each year of eligibility until age 15. Over time, that could add up to as much as $2,000 in grant payments, plus interest.

*This amount is indexed each year based on the rate of inflation.

To apply for a CESG follow these simple steps:

1. Register the birth or adoption of the child.
2. Apply for a birth certificate for the child.
3. Apply for a Social Insurance Number (SIN) for the child. You can download the SIN application form here.
4. Open a Registered Education Savings Plan (RESP) and make a deposit.
5. Download the appropriate form for your CESG application:

 

• • • If you are a parent and/or legal guardian and are contributing to your child's RESP, download form HRSDC 0073 E
    • If you are a grandparent, aunt, uncle or non-relative and are contributing to a child's RESP, download form HRSDC 0071 E (The original form must be forwarded to the RESP promoter)

 

Not at all. Your Beneficiary is eligible for the CLB commencing with the year of birth or the year your Beneficiary became a Canadian resident. If you have not applied for the CLB right away, the Federal Government will still make payments for the previous years. All you need to do is to apply for the CLB.

You have up until your Beneficiary turns 18 to apply for the Canada Learning Bond, but the earlier you apply, the sooner the grant money will start to grow in an RESP

The Alberta Centennial Education Savings (ACES) Plan Grant was created by the Alberta government to motivate Alberta residents to begin planning and saving for their child's post-secondary education as early as possible.

The ACES Plan Grant starts with a one-time initial contribution of $500 to an eligible child's RESP who was born to (or adopted by) Alberta residents in 2005 and later. The government also provides three subsequent grants of $100 to an eligible child's RESP to children of Alberta residents when they turn 8, 11 and 14 in 2005 and later. In total, $800 in Alberta grants is available per eligible child. To receive the initial $500 or $100 subsequent grants, the following conditions must be met:

• the child's parent or guardian who must be a resident of Alberta either at the time of the application, or at the time of the child's applicable birthday;
• the child is attending school in Alberta in either at the time of the application, or at the time of the child's applicable birthday; and
• Accumulated deposits of at least $100 have been made to an RESP within one year prior to the application for each subsequent Alberta Grant payment. Application for each grant, the applicable age, must be submitted within 6 years.

You need to apply for the initial $500 ACES grant and for each of the subsequent $100 grants separately.

To apply for the initial $500 ACES grant (Age 0):

1. Register the birth or adoption of the child.
2. Apply for a birth certificate for the child. You must apply in person through the Registry Agent Network.
3. Apply for a Social Insurance Number (SIN) for your child (at any Canada/Alberta Service Centre). You can download the SIN application form here.
4. Open a Registered Education Savings Plan (RESP)
5. Download the ACES application here; you'll find a step by step guide to help you complete the ACES application form. Please note that the proof of Alberta residency must be provided along with the original completed ACES application.

To apply for the subsequent $100 ACES grant (Age 8, 11 and 14):

If you and your Beneficiary are eligible, in order to get the subsequent $100 ACES grant, all you need to do is:

1. Following the guidelines above, open up an RESP Plan, if you do not already have one.
2. Download the ACES application form, you can also download a step by step guide to help you complete the ACES application form. Please note that the proof of Alberta residency must be provided. Separate applications for each of the 3 subsequent Alberta Grants must be submitted within 6 years following the child's 8th, 11th, and 14th birthday.

The Government of Quebec introduced the Quebec Education Savings Incentive (QESI) to further encourage Quebec families to save for their children's post-secondary education on February 2007. This incentive is paid in the form of a refundable tax credit by Revenue Quebec into the Registered Education Savings Plan (RESP) of the Beneficiary. The Beneficiary must be a resident of Quebec. The QESI is comprised of a basic and an increased credit and is subject to a lifetime maximum of $3,600 per Beneficiary.

1. Register the birth or adoption of the child.
2. Apply for a birth certificate for the child.
3. Apply for a Social Insurance Number (SIN) for your child (at any Canada/Alberta Service Centre). You can download the SIN application form here.
4. Open a Registered Education Savings Plan (RESP) with an RESP provider such as Heritage Education Funds.

Once an RESP for your Beneficiary is set up, Heritage will apply annually to Revenue Quebec for the QESI monies to be paid into your RESP. You are not required to fill out any paperwork or make an application for the QESI on your income tax return.

An EAP is any amount paid or payable under an RESP to or for an individual, called the Beneficiary, to assist with the individual's education expenses at the post-secondary school level. These amounts do not include refunds of principal contributed by Subscriber(s) of the plan.

Your Educational Assistance Payments under the Heritage RESP Plans

are not affected by other bursaries and/or scholarships from other sources. These payments may in turn affect payments from other sources such as OSAP assistance. Please check with the bursary/scholarship provider for confirmation.

Yes you can. Section B on the Maturity Application enables you to request for an EAP at maturity.

A postponement of an EAP is applicable for the first EAP when the Beneficiary is expected to be registered full-time in the 2nd year of post-secondary studies. The first EAP may be postponed for a maximum of 2 years, one year at a time, by August 15th of the Year of Eligibility (this is a year after the Maturity Date of the Contract). Further postponements may be granted to the Beneficiary, under extenuating circumstances, at the discretion of the Scholarship Committee. A letter of appeal from the Beneficiary along with original supporting documents will be required for submission to the Committee prior to the deadline.

A deferral of an EAP is applicable for the second or third EAP when the Beneficiary is expected to be registered for full-time in 3rd or 4th year of post-secondary studies, respectively. There is only one deferral permissible under the terms and regulations of the RESP Contract. Further deferrals may be granted to the Beneficiary, under extenuating circumstances, at the discretion of the Scholarship Committee. A letter of appeal from the Beneficiary along with supporting documents will be required for submission to the Committee prior to the deadline.

If the Beneficiary (student) is eligible to receive an EAP for the academic year, the approximate amount must be reported on the OSAP application as the Beneficiary's income since it will be reported on his/her taxes.

If the Beneficiary's status is Native Indian, the RESP Contract is not affected when releasing funds for Maturity and EAPs. The Beneficiary will be required to complete the proper documents and submit the Proof of Registration in order to receive the payments, just like any other student. The only difference is that he/she may not be required to pay taxes for the EAP amounts received due to their status. You may obtain further clarification from Canada Revenue Agency regarding tax implications at 1.800.959.8281.

In spring of the year your Heritage, or Impression Plan is scheduled to mature (normally the year in which the child turns 18), we will be sending you an information package that will guide you through the steps of the RESP Maturity process

On or after the Maturity Date, the Principal, (which is contributions made, less fees) is returned to the Subscriber or, on instruction by the Subscriber, to the Subscriber's Beneficiary. The Principal may be, but is not required to be, used for the costs of the first year of attendance at a post-secondary institution. The Maturity Date may be advanced by a maximum of 2 years at the Subscriber's request if the Beneficiary intends to attend a post-secondary program earlier than originally scheduled (certain conditions apply).

Under a Scholarship Option, we require the Proof of Registration or Offer of Admission that confirms the Beneficiary is enrolled full-time to release the Principal. Under the Self-Determined Option (SDO) of the Heritage Plans, if the Beneficiary is not expected to enroll in a post-secondary education program, you may request to have your Principal (which is contributions made, less fees) returned without providing the Proof of Registration, but the government grants (if applicable) will be forfeited and returned to the Government.

There are two maturity options under the Heritage Plans:

• The Scholarship Option (continuing in the Group Plan)
• The Self-Determined Option (continuing in the Self-Determined Plan)

Under the Scholarship Option there are three alternatives to select from, with Educational Assistance Payments made in one, two or three years. Your selection will usually depend on the length of Post-Secondary Program your Beneficiary has entered. Alternatively, you may select the Self-Determined Option.

If your Beneficiary enrolls in a 2, 3 or 4-year program, the Scholarship Option is the most beneficial. A combination of programs totaling 2, 3, or 4 years qualify as well.

With the Scholarship Option, your RESP contributions (less applicable fees) are returned to you tax free at maturity. These can be used to fund your Beneficiary's first year of a post-secondary education.

Yes. Depending on the length of program your Beneficiary attends, you can decide how the Educational Assistance Payments (EAPs) should be paid to your Beneficiary. There are three payout options available:

For students attending a 2-year program, Option #1 provides 1 EAP that consists of government incentives, income* earned on savings and government incentives, attrition** and enhancement***.

For students attending a 3-year program, Option #2 provides 2 annual EAPs, where each payment consists of 50% of government incentives, income* earned on savings and government incentives, attrition** and enhancement*** with funds paid over two years and distributed with each EAP. An amount equal to 50% of Membership Fees may be paid in two equal installments with each EAP***.

For students attending a 4-year program, Option #3 provides 3 annual EAPs, where each payment consists of: 33.3% of government incentives, income* earned on savings and government incentives, attrition** and enhancement*** with funds paid over three years and distributed with each EAP. An amount equal to 100% of Membership Fees may be paid in three equal installments with each EAP***.

* In each year the available Income, including that from terminated Plans, is divided by the number of Units of eligible Beneficiaries who have selected the same number of EAPs. The result is multiplied by the number of Units held with respect to the particular eligible Beneficiary and distributed as part of the EAP. Income on government incentives from terminated Plans is not included in this amount.

**Attrition is the term that applies to the share of pooled income that remains in the Heritage Plans, after any Beneficiaries in the same group as your Beneficiary, do not qualify for payments. For those Beneficiaries, the Principal is returned to the Subscriber, but the income that was earned on the Principal stays in the total asset pool, to be shared by Beneficiaries remaining in the pool. Please refer to the Heritage Plans' most recent prospectus for the attrition rates of the past five (5) years.

***Discretionary payments (consisting of Membership Fee returns and enhancements) are not guaranteed. You should not count on receiving a discretionary payment. The Foundation decides if it will make a payment in any year and how much the payment will be.

The Self-Determined Option is designed specifically for Beneficiaries enrolled in a post-secondary program shorter than two years or not attending at all.

With the Self-Determined Option of the Heritage RESP Plan, you, the Subscriber, may withdraw your principal any time after the Maturity Date, less applicable fees. Then, as long as your Beneficiary is in attendance at a post-secondary program offered by a recognized institution, he or she is eligible to receive Educational Assistance Payments. If the Beneficiary does not plan to pursue a post-secondary education, the Subscriber may request to release an Accumulated Income Payment (certain conditions apply).

Your Beneficiary will receive Educational Assistance Payments, which are made up of all income which has accrued on your Heritage Plan principal, all Canada Education Savings Grant, Canada Learning Bond, Alberta Centennial Education Savings Grant and Quebec Education Savings Incentive, where applicable, and the interest earned on those grants. Educational Assistance Payments can be applied to any qualifying post-secondary education program costs, including tuition, books, residence, and other legitimate education expenses.

Under the Self-Determined Option, your RESP funds can be used for either full-time or part-time studies in a qualifying program. A qualifying full-time program in Canada is a course of study of at least three consecutive weeks, with at least 12 hours of study per month. A qualifying program outside of Canada, is a course of study at a university of at least three consecutive weeks, with at least ten hours of study each week; or, a course of study at a Recognized Institution, other than a university, of at least 13 consecutive weeks, with at least ten hours of study each week. A qualifying part-time program outside of Canada at a Recognized Institution of at least 13 consecutive weeks, with at least 12 hours of study per month.

Educational programs do not qualify if taken at a time during which the student is receiving employment income (excluding part-time or temporary employment to finance studies) and the program is taken in connection with, or as part of, the student's employment.

If the Beneficiary is registered for at least 3 consecutive weeks and no less than 12 hours per month, the maximum amount that may be released for each 13-week period of study is $2,500. The Beneficiary must continue studies to qualify for additional payments.

If the Beneficiary is registered for full-time studies, the maximum amount of an EAP that can be made to a student as soon as he/she qualifies to receive them is $5,000. After the student has completed 13 consecutive weeks, and is still considered a full-time student, there is no limit on the amount of EAPs that can be paid if the student continues to qualify to receive them. If there is a 12-month period in which the student was not enrolled in a qualifying educational program for 13 consecutive weeks, the $5,000 maximum applies again.

Any subsequent withdrawal within the same year will be subject to a processing fee of $10.00 (plus applicable taxes).

You must select an option if you require funds from your RESP to pay for post-secondary studies. You have until July 31st of the Maturity year to select an option. The deadline cannot be extended. If the Beneficiary does not plan to enroll in a post-secondary education program in the year the Plan is scheduled to mature, please request to delay the Maturity Date before July 1st in the year the Plan is scheduled to mature. Delays from the original Maturity Date are permissible up to July 31st prior to the Beneficiary's 21st birthday.

If your Beneficiary decides not to pursue a post-secondary education, you may select the SDO and may withdraw your Principal and:

• Roll the Interest into your or your spouse's RRSP (if your spouse is a joint Subscriber) provided that you have contribution room available and that the conditions for an Accumulated Income Payment (AIP) have been met.
• If you do not have RRSP contribution room available and you make a withdrawal on your Principal and Interest earned, Canada Revenue Agency (CRA) will levy an additional federal tax of 20% (12% federal and 8% provincial for Quebec residents) on the withdrawn funds (other than Principal), on top of your regular tax rate.

You may also substitute the Beneficiary on your Plan with another Beneficiary and keep the principal in the Plan until the new Beneficiary decides to pursue post-secondary education or until the Plan reaches its 35-year lifetime limit; whichever occurs first.

Yes, a Beneficiary can still apply for the EAP at a later date up until January 31st of the following year provided the required documents are forwarded to the Foundation. The late fee of $75.00 (plus applicable taxes) will be deducted from the EAP amount. To avoid this late fee, we encourage you to send us the EAP application as soon as possible or call our Customer Service Team prior to August 15th to advise us of your current circumstances. The Proof of Registration can be submitted at a later date at any time prior to January 31st of the following year.

Part-time registration will not enable the Beneficiary to receive Educational Assistance Payment (s) under the Scholarship Option of the Heritage Plans.

However, under the Self-Determined Option, a Beneficiary (student) can access up to $2,500 of the income and grants for each 13-week period of study. The Beneficiary will be required to register in a post-secondary course that lasts at least 3 consecutive weeks long and no less than 12 hours per month. Official confirmation from the Office of the Registrar will be required to facilitate this payment.

When the EAP package is mailed in April or May of any given year, he/she may request to put the EAP on hold until January 31st of the following year. This extension may be requested in writing from the Beneficiary by completing the EAP Application, by calling the Customer Service Team at 416.502.2500 or toll free at 1.866.269.0639, or by contacting us via email at customercare@heritageresp.com prior to August 15th.

Each condensed program has different criteria for completion, which is regulated by the post-secondary institution where such program is offered. For example, if a Beneficiary (student) is going to take 3 years to complete a 4-year program, there may be an opportunity for the Beneficiary to receive all 3 EAPs under the Scholarship Option. For further details, please call our Customer Service Team by phone at 416.502.2500 or toll free at 1.866.269.0639 or contact us online

Canada Revenue Agency regulations confirm that apprenticeship programs qualify if the institution certifies that the program is a minimum of two years in length, the Beneficiary is in class for a minimum of six months per year, the work portion of the program is part of the curriculum, and the Beneficiary does not get paid for the work term. The program will not qualify if it is taken at a time during which the student is receiving employment income (excluding part-time or temporary employment to finance studies) and the program is taken in connection with, or as part of, the student's employment. For most apprenticeship programs, students are paid for training/learning the trade therefore, the Self-Determined Option is most suitable so that the Principal, Interest, and Canada Education Savings Grant (if applicable) are released while the Beneficiary is registered in classes prior to their hands-on training.

The Office of the Registrar is the office that can be located at your post-secondary institution through which you register for your post-secondary courses. They are also responsible for the record keeping of all students' files and course information.

The Beneficiary (student) is required to complete the Personal Information section of the Proof of Registration form, sign, and date the form. The rest of the form must be completed, signed, and stamped/sealed by the Office of the Registrar at the post-secondary institution.

Please note that the original completed Proof of Registration form must be mailed to us for processing. Alternatively, we will accept a faxed copy transmitted from the Office of the Registrar only accompanied by a cover letter. If the Proof of Registration form has been amended in any way, we can only accept a faxed copy transmitted directly from the Office of the Registrar.

After receiving the EAP package in the spring in any given year and if the Beneficiary (student) realizes that he/she will not be able to submit the Proof of Registration form or the EAP Application before the August 15th deadline, he/she must request an extension. This extension is automatically granted up until January 31st of the following year and may be requested in writing from the Beneficiary by completing the EAP Application, by calling the Customer Service Team at 416.502.2500 or toll free at 1.866.269.0639, or by contacting us online. Please note that the sooner the Foundation receives the EAP Application and the Proof of Registration form, the earlier the EAP will be released.

If the Beneficiary is eligible to apply for an EAP, however he/she has not completed the previous academic level successfully, he/she may request to postpone the first EAP for a maximum of two years after the maturity date, one year at a time, to the beginning of the next EAP season. Further postponements may be granted by the Scholarship Committee* at its discretion, under extenuating circumstances. If the first EAP has already been released and the Beneficiary is eligible to apply for the second or third EAP, a deferral may be granted for a maximum of one year, to the beginning of the next EAP season. Further deferrals may be granted by the Scholarship Committee at its discretion, under extenuating circumstances.

*Scholarship Committee: means the committee established by the Board of Directors of the Foundation to make decisions concerning eligibility, Recognized Institutions and other matters.

Successful completion means that the Beneficiary (the student) has met the course requirements as determined by the post-secondary institution and is able to enroll in his/her next academic level. Each post-secondary institution has a credit scheme or year equivalents for the programs available where students are categorized by year level according to the number of credits they have earned. Credits not completed may prevent advancement to the next academic level. In such case, the Beneficiary will not be eligible to receive the EAP and may be required to either postpone or defer the EAP to the following year.

If the Beneficiary is eligible to apply for an Educational Assistance Payment ("EAP"), however has not completed the previous academic level successfully, you may request to postpone the first EAP for a maximum of two years after maturity, one year at a time, to the beginning of the next EAP season. Further postponements may be granted by the Scholarship Committee at its discretion. If the first EAP has already been released and the Beneficiary is eligible to apply for the second or third EAP, a deferral may be granted for a maximum of one year, to the beginning of the next EAP season. Further deferrals may be granted by the Scholarship Committee* at its discretion.

Alternatively, the Beneficiary may also request to have the EAP held until January of the following year which will provide him/her the opportunity to make up for the missed courses/credits during the fall term. The deadline to apply for the EAP on hold is January 31st.

*Scholarship Committee: means the committee established by the Board of Directors of the Foundation to make decisions concerning eligibility, Recognized Institutions and other matters.

The Maturity Date can be delayed one year at a time up to July 31st prior to the Beneficiary's 21st birthday. This option can be selected on the Maturity Application under question 2 or, by completing the Maturity Application online. Alternatively, Subscribers may also request to delay the Maturity Date by sending a signed letter before the July 1st deadline. Such letter can be sent using the following methods:

Mail:
Heritage Education Funds Inc.
2005 Sheppard Avenue East, Suite 700
Toronto, ON M2J 5B4 Canada

Fax:
416.502.2555

Email:
CustomerCare@HeritageRESP.com

• Both Beneficiaries are under 21 years of age
• The new Beneficiary is younger than the original Beneficiary and is a resident of Canada at the time of the substitution
• An EAP has not been forfeited or released to the current Beneficiary
• To transfer the Canada Education Savings Grant ("CESG") to the new Beneficiary, the new Beneficiary must be less than 21 years of age and a sibling of the original Beneficiary by blood or adoption. Otherwise, CESG will be repaid to the government.
• To transfer the Alberta Centennial Education Savings ("ACES") to the new Beneficiary, the new Beneficiary must be less than 21 years of age and a sibling of the original Beneficiary by blood or adoption. Otherwise, the ACES will be repaid to the Government.
• To transfer the Quebec Education Savings Incentive ("QESI") to the new Beneficiary, the new Beneficiary must be less than 21 years of age and a sibling of the original Beneficiary by blood or adoption. The new Beneficiary must also be a resident of Quebec. Otherwise, the QESI will be repaid to the Government.
• The Canada Learning Bond ("CLB") will be returned to the Government since this is not transferable.

• 
  If the Self-Determined Option has been selected:
• A substitution may occur at any time with no age restriction, provided that an EAP has not been released to the current Beneficiary
• To transfer the Canada Education Savings Grant ("CESG") to the new Beneficiary, the new Beneficiary must be less than 21 years of age and a sibling of the original Beneficiary by blood or adoption. Otherwise, the QESI will be repaid to the Government
• To transfer the Alberta Centennial Education Savings ("ACES") to the new Beneficiary, the new Beneficiary must be less than 21 years of age sibling of the original Beneficiary by blood or adoption. Otherwise, the ACES will be repaid to the Government
• To transfer the Quebec Education Savings Incentive ("QESI") to the new Beneficiary, the new Beneficiary must be less than 21 years of age and a sibling of the original Beneficiary by blood or adoption. The new Beneficiary must also be a resident of Quebec. Otherwise, the QESI will be repaid to the Government
• The Canada Learning Bond ("CLB") will be returned to the Government since this is not transferable
• If the new Beneficiary is older than the original Beneficiary, please note that the lifetime contribution limits for the new Beneficiary may be exceeded which could result in additional tax for all Subscribers of that Beneficiary

The Heritage Education Optional Insurance, underwritten by Sun Life Assurance Company of Canada, is available to protect the Subscriber in the event that the Subscriber suffers a disability or becomes deceased while still in the Contribution period of the Heritage RESP Plan.

If a Subscriber becomes deceased before the maturity date of the ESP Contract (a Contract made between an individual (or an individual and the spouse of the individual) and the Foundation under which the Foundation agrees to issue EAPs), upon approval of the life claim, the insurance company will pay the life insurance benefit to the Foundation, to be used by the Foundation to satisfy the applicable contributions according to the terms of the ESP Contract.

If a Subscriber becomes disabled before the maturity date of the ESP Contract, the insurance company will pay the disability insurance benefit to the Foundation after a 9 month qualifying period. Upon approval of claim, the insurance company will make the applicable monthly contributions according to the terms of the ESP Contract.

Qualifying period means 9 consecutive months beginning on the date the Subscriber becomes disabled and ending on the date the Subscriber qualifies for benefits.

Without the Heritage Education Optional Insurance coverage, the remaining Subscriber (in the case of Joint Subscribers) or heirs of the Subscriber will be required to continue with the Contributions, if applicable, in order for the Plan to remain in good standing.

You are qualified for insurance coverage if you have an ESP Contract (a Contract made between an individual (or an individual and the spouse of the individual) and the Foundation under which the Foundation agrees to issue EAPs) with the Foundation as a Plan Subscriber or Joint Subscriber and you are under the age of 65 on the date of application for insurance coverage.

If there are joint Subscribers to an ESP Contract, the first deceased or disabled Subscriber will be deemed the insured person under the policy.

Insurance Premiums are set out in the Contribution Schedule of your Prospectus. If you have Insurance on your Plan, the premium is included in your monthly Contribution amount however it will not attract any of the government incentives.

Please contact us at 416.502.2500 locally or toll free at 1.800.731.2101 or email us at CustomerCare@HeritageRESP.com. One of our Customer Service Representatives will be glad to guide you through the steps of purchasing insurance.

Upon receipt of your termination request that is signed by the Subscriber (if the Plan is jointly held, both Subscribers must sign the request), the insurance premiums will be refunded only if the insurance purchase date at the time of cancellation falls within 60 days from the later of:

1. the date the ESP Contract was accepted by the Foundation, and
2. the effective date of insurance.