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Orginally posted by urmilkapadia

Hi,

I have some question on realted to RESP and RRSP.

First RESP.

I opened RESP account for my baby. My future plan like this After Citizenship I would like to go back to India. so What is advantage from that plan?

1. Should I get all amount ( with govement bonus and interest ) benefit in India?
2. IF my dauther join in 2,3 or 4 years education plan after 18 years then what should be benfit in India?
3. Should I have submit Recepit from College?
4. What is procedure for getting money in India?

RRSP

I opened RRSP A/C also.

1. If I leave this country after 5-7 years then Should I get benefit of RRSP?
2. What is procedure for getting money in India?

Give me more idea about this 2 plan.

Thanks
Urmil

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Hi Urmil,

Sorry for the belated reply.

A while ago I compiled the following Q&A for Canadians who emigrate or become non-residents and who have RESPs. You may get useful info once you go through these.

The difference between RRSP and RESP is that you need Canadian income to contribute to RRSP but it is not a requirement for RESP. Otherwise rules are more or less the same.

The procedure for getting RESP money in India is as follows:

Once your child gets admission in a recognised college or university, you should send the admission letter along with tuition schedule to the RESP provider for them to release the grant. The rules for EAPs are defined by CESG and HRDC but actual implementation is left to the RESP providers.

Q. What happens to my children’s Registered Education Savings Plan (RESP) when I emigrate?

A. Your children’s RESP plan can remain in Canada while you are a non-resident. The RESP plan will continue to earn tax deferred income in Canada.
Please note that the growth within your children’s RESP may be subject to tax from your new country of residence.

Q. Am I able to make RESP contributions while I am a non-resident of Canada?

A. When you are a non-resident, you are able to make RESP contributions. However, as long as your children remain non-residents of Canada they will not be eligible for the Canada Education Savings Grant.

Q. The CESG is not available to beneficiaries who are non-residents. If a beneficiary is a Canadian resident, but subsequently becomes a non-resident, would the grant earned while the beneficiary was a resident have to be repaid?

A. To be eligible for the Canada Education Savings Grant (CESG), the beneficiary must be a Canadian resident at the time of the contribution into the RESP. If the beneficiary becomes a non-resident after receiving a grant, the grant money would not have to be repaid.

Q. Does the beneficiary have to live in Canada for Contribution or Educational Assistance Payment (EAP) Purposes?

A. There is no requirement under the ITA that the beneficiary be a resident in Canada in order to have contributions made to an RESP on his/her behalf or in order to receive educational assistance payments. There is a requirement for the beneficiary to be a resident in Canada at the time the contribution is made in order to be eligible to receive the Canada Education Savings Grant (CESG).

Q. Will the CESG be paid when the beneficiary is a non-resident of Canada?

A. No. The beneficiary must be resident in Canada, according to the Income Tax Act, at the time the contribution is made in order for HRDC to pay the CESG into the RESP account. The beneficiary may use the EAP to attend post-secondary studies at a designated educational institution anywhere in the world.

Q. If a beneficiary is a Canadian resident, but subsequently becomes a non-resident, would the grant earned while the beneficiary was a resident have to be repaid?

A. As a resident of Canada at the time the contributions were made, the beneficiary was eligible for the CESG. If the beneficiary subsequently became a non-resident, the grant money would not have to be reimbursed. During the period when the beneficiary is a non-resident, he would not be eligible for the CESG on contributions made to his RESP.

Q. Can a resident beneficiary who has received the grant but who now attends a postsecondary institution outside Canada still qualify for the grant portion of the EAP or would the grant have to be repaid?

A. The grant would not have to be repaid provided the beneficiary is pursuing a program of post-secondary studies in an accredited educational institution outside the country. Otherwise, no CESG money would be included in the EAP and the grant would have to be repaid. (The exception is where the RESP is a family plan and there are beneficiaries who had not yet qualified for EAPs.)

If you need further clarifications, you can post them here.