What happens if I contribute to an RESP, but my child does not pursue post-secondary education?

There are a number of options available.
  • You can transfer your plan to another to another child who is eligible
  • If your child is over the age of 21 and the plan has been open for more than 10 years,
    • You may transfer up to $50,000 of income to your RRSP or spousal RRSP tax-free, provided you have sufficient contribution room. Government grants will need to be returned to the government.
    • Alternatively, you can simply withdraw the income and pay tax on it at your marginal tax rate, plus an additional tax of 20%. Remember, your principal will always be returned to you tax-free. Government grants will need to be returned to the government.

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