You’ve got questions – we’ve got answers! This page presents some commonly asked questions about Knowledge First Financial, RESPs and how government grants in Canada work. If you can’t find the answer here, we encourage you to explore the wealth of information found in the Learn section category of our website (see options in the navigation menu). An RESP expert would also be happy to help you by phone, email or live chat.
As the first name in RESPs, Knowledge First Financial is Canada’s largest registered education savings plan company. With approximately $7.0 billion in assets under management and a network of over 1,750 sales representatives, Knowledge First Financial is committed to empowering students by giving them the resources they need to financially and mentally succeed along their academic journeys. The company manages over 600,000 RESPs for customers, helping approximately 60,000 students through post-secondary studies each year. Since 1965, the Knowledge First has paid out approximately $8.2 billion to subscribers and students through their plans.
Knowledge First Financial is a wholly-owned subsidiary of Knowledge First Foundation, a not-for-profit Canadian corporation. With no shareholders, the Foundation is able to reinvest net revenues in initiatives that support students. To date, the Foundation has supplemented over $50 million in payments to students and has awarded $1.5 million in graduate scholarships.
An RESP is an education savings plan registered under Canada’s Income Tax Act, which provides financial assistance to beneficiaries when they pursue post-secondary education. Income on savings within a RESP is tax-sheltered until the beneficiary is ready for post-secondary education. The earnings are taxed in the hands of the student, who typically pays little to no tax. In addition, RESPs may qualify for various government grants that help parents, relatives and friends save for post-secondary education. Subscribers and beneficiaries enrolled in a RESP must have a valid Social Insurance Number every time a contribution is made. A beneficiary must also be a Canadian resident when the RESP is opened and every time a contribution to an RESP is made.
One of the easiest ways to help fund your child’s future post-secondary education is with a RESP. It’s easy to get started and there are different ways to do so:
Whichever way you contact us, we will help you set up a plan that suits your financial needs and meets your beneficiary’s future post-secondary education savings objectives.
For a child born in 2021, a 4-year undergraduate program at a Canadian university including expenses could cost over $130,000.* To prepare for the rising cost of education, many parents have decided to invest additional funds in a RESP for their children. You can do it too!
Contributing a little more today could make a big difference tomorrow. Your sales representative would be pleased to arrange a review of your education savings goals and advise you on how best to maximize grants available to you.
You can also call our customer service team toll-free at 1 800 363-7377 or contact us online.
* Increasing your contributions is subject to suitability and affordability guidelines. According to the Income Tax Act (Canada), the total RESP lifetime contribution limit is $50,000 per beneficiary. Any excess contributions will be subject to a 1% per month penalty tax. Government grants are not included for the purpose of calculating the amount of the lifetime contribution limit.
** *Projections based on Tuition Cost, 2020-2021 Preliminary (Statistics Canada). Weighted averages include public and private institutions. Compulsory fees cover items such as athletics, health services, and student association fees. Expenses include student tuition fees, books, shelter, food and transportation.
Absolutely! Our business depends on people like you. We are interested in helping people who care about their children’s future and who want to help them be successful in life. We encourage you to provide them with the contact information of your sales representative, direct them to visit our website at www.knowledgefirstfinancial.ca or have them contact us by phone, email or live chat.
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 a 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.
The A-CESG is intended to help families receive the $7,200 lifetime maximum sooner by providing an addition 10% or 20% on the first $2,500 contributed to your RESP. Eligibility is based on net family income.*
For 2021, if your net family income is below $49,020*, 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 49,020 and $98,040*, 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.
Canada Education Savings Grant (CESG)
| Net Family Income | $49,020 or less | More than $49,020 to $98,040 | More than $98,040 |
| Basic CESG paid on first $2,500 of annual RESP contribution | 20% = $500 | 20% = $500 | 20% = $500 |
| Additional CESG paid on first $500 of annual contribution | 20% = $100 | 10% = $50 | Not eligible |
| Annual total | $600 | $550 | $500 |
*Indexed annually.
*Primary caregiver is the person who is primarily responsible for the care and upbringing of a child.
To apply for a CESG follow these simple steps:
For more extensive rules for RESP contributions and CESG provisions, please visit our RESP Rules page and Prospectus page.
The Canada Learning Bond provides a one-time initial grant payment of $500 to an eligible beneficiary’s Registered Education Savings Plan. The Government will automatically add $100 for each year of eligibility until your child is 15 years old. Over time, that could add up to as much as $2,000 in grant payments, plus interest. Eligibility is based on net family income and number of children.
The adjusted net family income levels and number of children required to qualify for the July 1, 2020 to June 30, 2021 benefit year are:
| Number of children | Adjusted net family income for the 2020-2021 benefit year |
| 1 to 3 | Less than or equal to $47630 |
| 4 | Less than $53740 |
| 5 | Less than $59876 |
| 6 | Less than $66011 |
To apply for a CLB follow these simple steps:
Not at all. Your beneficiary is eligible for the CLB the year they’re born or the year they became a Canadian resident. If you have not applied for the CLB right away, the Federal Government will still make payments for the previous years. All you need to do is to apply for the CLB.
You have up until your beneficiary turns 18 to apply for the Canada Learning Bond, but the earlier you apply, the sooner the grant money will start to grow in a RESP.
The Government of Quebec introduced the Quebec Education Savings Incentive (QESI*) to further encourage Quebec families to save for their children’s post-secondary education on February 2007. This incentive is paid in the form of a refundable tax credit by Revenu Québec into the Registered Education Savings Plan (RESP) of the beneficiary. The beneficiary must be a resident of Quebec. The QESI* is comprised of a basic and an increased credit and is subject to a lifetime maximum of $3,600 per beneficiary.
* Certain conditions apply. See prospectus for full details.
Once a RESP for your beneficiary is set up, Knowledge First will apply annually to Revenu Québec for the QESI* monies to be paid into your RESP. You are not required to fill out any paperwork or make an application for the QESI* on your income tax return.
* Certain conditions apply. See prospectus for full details.
This grant is offered to each resident beneficiary born on or after January 1, 2007. After the beneficiary turns six years of age, the province of British Columbia will deposit $1,200 into the beneficiary’s RESP. To qualify, the RESP must be opened prior to the day before the beneficiary’s 9th birthday. No matching or additional contributions are required.
* Certain conditions apply. See prospectus for full details.
An EAP is any amount paid or payable under a RESP to or for an individual, called the beneficiary, to assist with the individual’s education expenses at the post-secondary school level. These amounts do not include refunds of contributions less fees contributed by subscriber(s) of the plan.
If the beneficiary (student) is eligible to receive an EAP for the post-secondary school year, the approximate amount must be reported on the OSAP application as the beneficiary’s income, since it will be reported on his/her taxes.
If the beneficiary’s status is Native Indian, the RESP Contract is not affected when releasing funds for maturity and EAPs. The beneficiary will be required to complete the proper documents and submit the Proof of Registration in order to receive the payments, just like any other student. The only difference is that he/she may not be required to pay taxes for the EAP amounts received due to their status. You may obtain further clarification from Canada Revenue Agency regarding tax implications at: 1.800.959.8281.
Now that your student has graduated high school and is headed off to receive a post-secondary education, it’s time to put all those hard-earned savings to work. Make sure you are making the most of them with these tips on how to maximize withdrawals.
There are two types of educational withdrawals:
How do I know whether my student’s post-secondary program qualifies for an educational withdrawal?
Under the Income Tax Act, a qualified post-secondary program must be:
A recognized institution is one that qualifies as a post-secondary educational institution under the Income Tax Act and is acceptable to Knowledge First Foundation. In addition to universities and colleges, recognized institutions include technical institutes, religious colleges and private post-secondary institutions registered under the “Private Vocational Schools Act.”
View your most recent Statement of Account from Knowledge First Financial by logging into the customer portal (see link in top menu).
Here are the EAP limits set by the Canada Revenue Agency (CRA):
Visit the RESP Withdrawals page for complete details on how to withdraw funds from your plan.
According to the Income Tax Act, proof of enrolment in a qualifying program is required to keep the government grants in your plan. RESP providers must request a Verification of Enrolment for every post-secondary withdrawal request. This form can be easily downloaded from the school website or obtained from the Registrar’s Office.
The Office of the Registrar is located on the campuses of post-secondary institutions. Through this office, students can register for their courses. The Registrar is also responsible for the record-keeping of all their files and course information.
It’s important to know that a RESP can remain open for 35 years. That’s good news if your student has decided to postpone or prolong their post-secondary education and they are in an individual plan.
If post-secondary studies are not in your child’s plans, you can transfer the plan to another student or consider one of the other ways to withdraw funds from your plan. We are here to help you understand the different options.