Once the beneficiary enrols in a qualifying program, an RESP pays out in two different ways, and they are taxed differently. This page explains both, the limits on the taxable part, and how families spread withdrawals across the years of study. The account rules as a whole are in the complete RESP guide, and every related guide is listed in the RESP hub.
The two types of withdrawal
| Educational Assistance Payment (EAP) | Refund of contributions (PSE withdrawal) | |
|---|---|---|
| What it contains | CESG, Canada Learning Bond, provincial grants and all investment growth | The subscriber’s own contributions |
| Paid to | The student | The subscriber, or the student if the subscriber chooses |
| Taxed? | Yes, as the student’s income (T4A box 042) | No |
| When | While the student is enrolled in a qualifying program | Any time; during enrolment it can be paid for education without affecting the grants |
| Limit | See below | None |
Contribution refunds taken while the student is not in school are allowed too, but the plan may have to repay part of the grant that the contributions attracted. Taking contributions out while the student is enrolled avoids that.
EAP limits
In a qualifying (full-time) program, EAPs (the grants and growth paid to the student) are limited to $8,000 for the first 13 consecutive weeks, with no limit after that (the limit applies again after a 12-month gap without such a period); in a specified (part-time) program, to $4,000 for any 13-week period. ESDC can approve more case by case when costs are much higher than average.| Study type | EAP limit |
|---|---|
| Full-time (a qualifying program) | $8,000 for the first 13 consecutive weeks of enrolment; no limit after that |
| Part-time (a specified program) | $4,000 for any 13-week period |
For a student starting in September, the first-period limit usually means EAPs totalling up to $8,000 in the fall term, with no limit once the first 13 weeks are complete.
What counts as a qualifying or specified program (and which schools are designated) is explained in using an RESP for trade school or college. Schools abroad have their own minimum lengths, covered in using an RESP outside Canada.
How the student is taxed
EAPs are added to the student’s income for the year they are paid. The student then claims the same credits as any taxpayer:
- the federal basic personal amount ($16,452 for 2026) and the provincial one, which is often smaller;
- the tuition tax credit, which can be used against the student’s own tax, carried forward, or partly transferred to a parent, as explained in our tuition tax credit guide.
A student whose summer job plus EAPs stays under those amounts pays little or no income tax. Filing a return for every year an EAP is paid, even when no tax is owed, records the tuition amounts so they can be carried forward or transferred.
Timing withdrawals across the years of school
Because EAPs are taxed year by year, the order and size of withdrawals matter more than the total:
- Spread the EAPs over every year of study. The grant and growth portion is taxed in the year it comes out. Taking all of it in the final year stacks it on top of that year’s income, while spreading it lets each year’s credits absorb part of it.
- Use EAPs before contributions. The contributions come out tax-free whenever they are taken, but the EAP portion can only be paid while the student is enrolled (or within 6 months after). If the student leaves school with EAP money still in the plan, it may never reach them at the student’s tax rate.
- Match EAPs to lower-income years. A student with a co-op term or a well-paid summer can take a smaller EAP that year and a larger one in a year with less income.
- Keep the last year’s money safe. Holding next year’s withdrawals in cash or GICs protects them from a market drop just before they’re needed.
The EAP is meant to help with the cost of post-secondary education; the federal government gives tuition, books, tools, transportation and rent as examples. Providers ask for proof of enrolment before paying one.
How to request a withdrawal
- Get proof of enrolment from the school (a letter or registration confirmation showing the program and full-time or part-time status).
- Send it to the RESP provider with its withdrawal form, saying how much should be paid as an EAP and how much as a refund of contributions.
- The provider pays the EAP to the student and the refund to the subscriber (or as the subscriber directs).
- Early in the following year, the student receives a T4A slip for the EAP.
If the money isn’t used for school
When the child doesn’t enrol, EAPs can’t be paid. The contributions still come back tax-free, but the CESG goes back to the government unless a brother or sister in the plan can use it (the Canada Learning Bond can’t be shared and is returned), and growth that isn’t moved to another beneficiary comes out as an accumulated income payment taxed at the subscriber’s rate plus an additional 20% (12% for Quebec residents), unless it is rolled into an RRSP. The rules for that rollover are in transferring an RESP to an RRSP, and the full set of options is compared in what happens if your child doesn’t go to university.
Related guides
Sources
The figures and rules on this page come from these sources, last checked against them between August 29, 2026 and October 1, 2026. How we check facts.
- Canada Revenue Agency: Registered Education Savings Plans (RESPs)
- Canada Revenue Agency: Indexation adjustment for personal income tax and benefit amounts