Canada Education Savings Grant (CESG)*

The CESG equals 20% of the first $2,500 of your annual contributions. If your child is eligible for the CESG, you will receive a maximum of $500 to $600 annually until your child reaches the age of 17, to a lifetime amount of $7,200.

 

With CESG you

may qualify for up to $7,200 in grants.

FAQ's on CESG

 

 

What is the Canada Education Savings Grant (CESG)?

Introduced in January 1998, the Canada 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 Canada 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.

 

What is the Additional CESG?

Effective January 2005, your beneficiary may be eligible to receive additional CESG if the primary caregiver* qualifies for the National Child Benefit Supplement (NCBS) which is part of the Canada Child Tax Benefit (CCTB) and your net family income is:

Net Family Income	Basic CESG	Additional CESG	Maximum grants receive
$44,701* or less	20%	20% on your first $500 annual contribution	$500 Basic + $100 Additional = $600
More than $44,701 and $89,401*	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 Canada Education Savings Grant (CESG):

• If your net family income is below $44,701*, 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 $44,701* and $89,401*, 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 Canada 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.

 

How do I apply for a Canada Education Savings Grant (CESG)? 

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. Please visit http://www.servicecanada.gc.ca/eng/sin/apply/how.shtml for more information on the SIN application process.
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 SDE 0093 E (The original form must be forwarded to the RESP promoter).

If you are a grandparent, aunt, uncle or non-relative and are contributing to a child's RESP, download form SDE 0093 E – Annex B (The original form must be forwarded to the RESP promoter).

Please note that this form must be sent along with the SDE 0093 E main form.

 

Are there any other CESG provisions?

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 year the beneficiary is 16 years old

* Certain conditions apply. See prospectus for full details

Understanding the terms

CESG

"CESG" means the Canada Education Savings Grant which is the grant from the Government of Canada with the cumulative lifetime maximum of $7,200 per eligible Beneficiary.

Basic CESG

"Basic CESG" means the Canada Education Savings Grant of up to 20% annually on up to $2,500 of Contributions to a Registered Education Savings Plan.

Additional CESG

"Additional CESG" means the additional Canada Education Savings Grant available to qualifying families. The amount of Additional CESG is up to 20% annually on the first $500 of Contributions to a Registered Education Savings Plan.

For more terms visit our glossary: http://www.heritageresp.com/glossary

* Certain conditions apply, please see Prospectus for full details.