RESP withdrawals: What are the eligible/qualified education costs or expenses, other than tuition?

What expenses are eligible for RESP?

So if your child needs a car to get to classes, you can use RESP money to pay for it, along with insurance, gas, parking and maintenance. Other eligible expenses may include rent, meals, living expenses, a laptop or tablet, a desk and student fees.

How do you draw out of an RESP?

To withdraw money from an RESP, contact your RESP provider. They will ask to see official proof of enrollment before issuing the Educational Assistance Payment.

Are RESP withdrawals taxable Canada?

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.

Can you withdraw 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.

Is RESP taxable when withdrawn?

Summary. Withdrawals from an RESP can either be taxable or non-taxable. When contributions are withdrawn, the subscriber can receive them tax free. Taxable payments include RESP investment earnings and government incentives when they’re paid in an EAP.

Do you get a T4A for RESP withdrawal?

You have to prepare a T4A slip for a subscriber if any RESP accumulated income payments totalling $50 or more are made in the calendar year. Also, you have to prepare a T4A slip for a beneficiary if any RESP educational assistance payments totalling $50 or more are made in the calendar year.

Can I withdraw from RESP anytime?

If you must collapse the RESP before the funds are depleted because your child doesn’t go on to post-secondary education or withdraws early, you could face hefty fines. The government portions will be returned to the government, and you withdraw your own contributions without penalty.

Can you use RESP money to buy a house?

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.