An RESP is a Canadian account for saving toward a child's education after high school, where savings grow tax-deferred and the federal government adds a grant to contributions.
The Canada Education Savings Grant (CESG) adds 20% on the first C$2,500 contributed each year, so up to C$500 a year, or C$1,000 in a year when you catch up on unused grant room. The lifetime grant is C$7,200 per child, paid on contributions up to the end of the year the child turns 17. Lower- and middle-income families can get an additional grant on the first C$500.
There's no annual contribution limit, but the lifetime limit is C$50,000 per child, and grants don't count toward it. Your contributions can come back to you without tax; the growth and the grants are taxed as the student's income when paid out for school.
Ages 16 and 17 have a catch: grants are paid in those years only if at least C$2,000 went in before the end of the year the child turned 15, or at least C$100 a year in any four earlier years.
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