Not every Canadian qualifies—or benefits—from RESPs. In fact, some specific conditions apply:

  • While nothing specific in the Income Tax Act requires someone who opens or contributes to an RESP to be a resident, in practice financial institutions often can’t accept funds from non-residents.
  • If the RESP holder leaves Canada, the account can be maintained but no new funds can be added.
  • If a beneficiary becomes a non-resident of Canada for tax purposes, educational assistance payments can still be made. But they can’t include government grants or bonds and will become subject to non-resident withholding tax.
  • Beneficiaries are only eligible for grants and bonds only up to the end of the year in which they turn 17, so immigrants with grown children may not find RESPs useful.