Do RESP contributions reduce my income tax in Ontario?

No. Unlike RRSP contributions, contributions to a Registered Education Savings Plan (RESP) are not tax-deductible and do not reduce your income for tax purposes. The tax advantage of an RESP is different: growth inside the plan (interest, dividends, capital gains) accumulates tax-free until withdrawal. When the student eventually withdraws the accumulated income to pay for post-secondary education, the taxable income is attributed to the student — who typically has little or no income and therefore pays little or no tax.

The Canada Education Savings Grant (CESG) adds federal matching money to the RESP — a percentage of annual contributions up to a set maximum per beneficiary, per year. Ontario previously had the Ontario Learning Bond and Ontario RESP matching, which provided additional grants for lower-income families; confirm current provincial grant availability with your RESP provider.

There is no annual contribution limit per year, but there is a lifetime contribution limit per beneficiary. Contributing over that limit triggers a penalty tax on the excess. Contributions can be made for up to 31 years after the plan is opened (subject to rules), and the plan can remain open for up to 35 years.