CANADA EDUCATION SAVINGS PROGRAM TERMS AND DEFINITIONS


CANADA EDUCATION SAVINGS PROGRAM (CESP) 

The Canada Education Savings Program (CESP) is a program within Employment and Social Development Canada (ESDC) that administers the Canada Education Savings Grant (CESG) and the Canada Learning Bond (CLB) to encourage early savings for a child’s Post-secondary education (PSE). 


REGISTERED EDUCATION SAVINGS PLAN (RESP) 

A Registered Education Savings Plan (RESP) is an education savings account that can help Canadians save for PSE. RESPs are registered by the Government of Canada to allow savings for education to grow tax-free until the person named in the RESP enrolls in PSE. RESPs also make it possible to receive the CESG, the CLB and provincial education incentives. 


SUBSCRIBER

A subscriber is an individual who opens a RESP to make contributions on behalf of an individual named as a beneficiary. A subscriber can be anyone, but it is usually a parent or a relative of the beneficiary.


BENEFICIARY

A beneficiary is usually a child, but it can be any person named by the subscriber of a RESP to receive money for post-secondary education (PSE) in the form of Educational Assistance Payments (EAPs). 


RESP CONTRIBUTIONS

Contributions refer to the amount of savings deposited into a RESP on behalf of the beneficiary. 


CANADA EDUCATION SAVINGS GRANT (CESG) 

The Canada Education Savings Grant (CESG) is a grant offered by the Government of Canada to encourage parents to save for their child’s PSE. The Basic CESG consists of a 20% payment on the first $2,500 in annual contributions made to a RESP in which the child is named as the beneficiary.


CANADA LEARNING BOND (CLB) 

The Canada Learning Bond (CLB) is a grant offered by the Government of Canada to help low-income families save for their child’s PSE. Eligible children can receive up to $2,000 in CLB, which is paid directly into a RESP in which they are named as the beneficiary.


ADDITIONAL CANADA EDUCATION SAVINGS GRANT (Additional CESG or A-CESG)

The Additional Canada Education Savings Grant (A-CESG) is a supplement to the Basic Canada Education Savings Grant for children from low- and middle-income families. The Government of Canada pays 10% or 20% on the first $500 in annual contributions made to an eligible child’s Registered Education Savings Plan (RESP).


POST-SECONDARY EDUCATION (PSE) 

Post-secondary education (PSE) refers to qualifying educational programs in designated institutions (e.g. CEGEPs, colleges, universities, vocational schools or others) in Canada or abroad. 


RESP WITHDRAWALS

RESP withdrawals refer to withdrawals made from an RESP to pay for PSE expenses. They consist of Educational Assistance Payments (EAPs) and Post-secondary education (PSE) withdrawals.


EDUCATIONAL ASSISTANCE PAYMENTS (EAPs)

Educational Assistance Payments (EAPs) are amounts paid from a RESP to an eligible beneficiary to assist with education-related expenses at the post-secondary level. EAPs include the CESG, CLB, provincial education incentives and income earned on the money saved in the RESP. These payments do not include contributions made by the subscriber.


POST-SECONDARY EDUCATION WITHDRAWAL (PSE WITHDRAWAL)

Post-secondary education (PSE) withdrawals are drawn from the contributions made by the subscriber to a RESP, and exclude education savings incentive amounts and income earned.


CLB PARTICIPATION RATE

The CLB participation rate is the ratio between the number of CLB beneficiaries and eligible children. It is the number of children who have ever received the CLB, expressed as a percentage of the total number of children eligible for the bond, as of a given year.