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A RESP is a savings plan for post-secondary education which allows funds to accumulate on a tax-deferred basis up to certain limits. There is no annual limit for contributions. For each beneficiary the lifetime limit on contributions is $50,000. Although there is no tax deduction, the interest and income earned within the plan is sheltered, which means that the tax is only payable on the funds withdrawn to fund the student’s education. And it is taxed at the student’s low rate.

RESP Canada Learning Bond

The Canada Learning Bond (CLB) is part of the Canadian RESP program. Actually the CLB is a grant. The big difference between this grant and the regular RESP grants is that no contribution is required. Once you qualify, you apply, and you can receive up to $2,000 deposited in your RESP account per child. The family net income must be below $45,282, in 2016 ($44,701 in 2015). An RESP account can be set up at a financial institution. This grant will provide more low income families the opportunity to get their children started in advancing their education. Go to www.canlearn.ca for more details.