Types of Transactions for RESP Events
Some types of electronic QESI transactions are for RESP events. The six transactions below have the same name as in our transactional exchanges. They must all be created in accordance with the Québec Education Savings Incentive: Interface Transaction Standards (SW-208-V).
Annual application for the QESI (T02)
To receive the QESI tax credit, you must submit an annual application that provides the net eligible contributions to an RESP for a given tax year. You can submit a single transaction per beneficiary and per plan for a taxation year.
The annual QESI amount consists of a basic amount and an increase amount.
For more information and calculations, see the Guide for Mandataries: Annual Application for the QESI (SW-289-T) (courtesy translation).
End of note
Basic amount
For a given taxation year, the basic amount that can be granted for a beneficiary who was resident in Québec at the end of that year is equal to the lowest of these amounts:
- 10% of the total net eligible contributions paid for the beneficiary for the year;
- $500;
- the amount of the beneficiary's accumulated entitlements for the year.
Determining the net eligible contribution
At the end of December 31 of the given taxation year, mandataries must determine the total net contributions for the year using this calculation:
Contributions made in the year – Withdrawals of contributions made in the year = Net contributions
The cumulative gross contribution limit for an RESP is $50,000.
Increase amount
An increase amount of up to $50 per year (calculated based on applicable family income) can be granted for a beneficiary. For more information on calculating the increase, see Family Income Thresholds Used to Calculate the Increase Amount (SW-179-T) (courtesy translation).
Determining the increase amount
For an increase amount to be granted for a beneficiary, one of these conditions must be met:
- the RESP has only one beneficiary;
- the RESP has several beneficiaries who are all siblings.
When you make an Annual application for the QESI transaction (type 02), you must answer this question to the best of your knowledge: Is this an individual RESP or a sibling-only RESP?
If a beneficiary is added to a family plan and they are not the sibling of the other RESP beneficiaries, the application for the non-sibling will result in the repayment of all the QESI amounts paid into the contract.
Furthermore, if an increase amount has been paid into an RESP whose beneficiaries are not all siblings, the entire QESI account balance immediately prior to the addition has to be refunded using the Special tax transaction (type 06) for reason 02 (beneficiary who is not a brother/sister of the others).
ENd of note
Increase amount situations
- If the beneficiary is in shared custody, the applicable family income for a given taxation year is equal to half of the combined income of each eligible individual and their cohabitating spouse.
- The applicable family income for a given taxation year is deemed to be zero where the beneficiary is lodged or sheltered (for example, in a foster family) on January 1 of the year following the given taxation year.
- A decision may be rendered without an increase in the following cases:
- The family income exceeds the eligible income limit for the increase.
- The beneficiary reached the QESI cumulative limit of $3,600.
- The parents cannot be found in our database, or the family income cannot be determined.
- The beneficiaries are not all siblings in a family plan.
Submitting an Annual application for the QESI transaction
For a given taxation year, you have until the 90th day following the end of the year to file an Annual application for the QESI transaction (type 02) so that the proportional sharing rule applies. In this case, payment will be in mid-May. The 90th day may vary for leap years.
For example:
- An Annual application for the QESI transaction (type 02) for the net contributions paid into the contract in 2022 must be filed before March 31, 2023.
- An Annual application for the QESI transaction (type 02) for the net contributions paid into the contract in 2023 must be filed before March 30, 2024.
Deadline for submitting an Annual application for the QESI transaction
Although an Annual application for the QESI transaction (type 02) can be submitted in the 90 days following the end of the year, a reasonable timeframe of three years is tolerated. An original or increased (amended) annual application must therefore be submitted before December 31 of the third year following the given taxation year.
For example, for the net eligible contributions paid in 2022, you have until December 31, 2025, to submit an Annual application for the QESI transaction (type 02).
Assigning the QESI
An inter-plan transfer may occur between the time the annual application is filed and the time we pay the QESI. We can then pay the QESI amount to the transferee plan rather than the transferor plan, provided the transferee plan partipates in the QESI and the assignment is made in an authorized transfer of all the property of the transferor plan.
The transfer must take place in the first 90 days of the year, when the transferor plan has just submitted its annual application for the previous year. In this case, the Inter-plan transfer transaction (type 04) must be submitted before we process the annual application for that year.
Both transactions must be accepted before the assignment can take place.
The decision to pay the QESI amount to either plan remains at our discretion.
End of note
Remittance slip for a decreased annual application
If you have a QESI amount to repay us after submitting a decreased annual application, complete remittance slip form TP-1029.IQ-V. You can pay online or by cheque or money order. For more information, see the instructions on the slip.
There is no deadline to request a decrease of a net eligible contribution and repay the overpaid QESI.
Replacement of a beneficiary (type 03)
If an RESP beneficiary is replaced, the QESI amounts paid into the contract may be retained for a recognized replacement. This transaction can be sent in the current year, i.e., the year the event occurs. In certain circumstances, it may be put on hold. In this case, an .att report will be sent to you. The transaction will automatically be included in the next production run, until it is accepted.
For replacement by an unrecognized beneficiary, a special tax will have to be paid. For more information, see the Special tax return (type 06) section and the Trustee Guide: Québec Education Savings Incentive (QESI) (IN-875-T) (courtesy translation).
Inter-plan transfer (type 04)
An inter-plan transfer is a transfer of property held by a trust (“transferor plan”) to a another trust (“transferee plan”).
This transaction can be sent in the current year, i.e., the year the event occurs. In certain circumstances, it may be put on hold. In this case, an .att report will be sent to you. The transaction will automatically be included in the next production run, until it is accepted.
- For more information and calculation examples, see the QESI Guide for Mandataries: Registered Education Savings Plan (RESP) Transfers (SW-203-V).
- For a transferee plan that does not offer the QESI, a special tax (type 06) for reason 11 (Unauthorized inter-plan transfer) must be paid.
End of note
Types of inter-plan transfers
An Inter-plan transfer (type 04) must be created by each mandatory concerned by a transfer, for each movement of money (in and out) and for each plan beneficiary. The subtypes of Inter-plan transfers are:
- Subtype 01: Transferor trustee
- Subtype 02: Transferor trustee
- Subtype 03: This subtype was created to provide an administrative solution for internal changes, such as a change in plan number or contract number. In such a case, only one transaction needs to be sent. Due to its administrative nature, this is always considered an authorized transfer.
Authorized transfer of property between two contracts
When there's a transfer of property between two contracts whose trustees and promoters respectively concluded a trustee agreement and a promoter agreement, the transferor trustee and the transferee trustee must complete form TP-1029.8.IQ-V, Québec Education Savings Incentive: Transfer Between Registered Education Savings Plans (RESP), whether the transfer is authorized or not.
Form TP-1029.8.IQ-V determines whether the trustee of the transferee plan is eligible and whether the transfer is authorized. The form is also used to exchange contract and plan numbers with the other trustee, and data on the amounts transferred. In short, the form enables the exchange of information between trustees in a transfer between two contracts. It should not be sent to us.
ENd of note
Unauthorized transfer
As soon as a transfer occurs (partial or total) and it is not authorized, any QESI amount paid into the contract must be repaid to us using the Special tax return transaction (type 6), reason 11 (Unauthorized inter-plan transfer).
Improved processing for inter-plan transfers (type 04)
The processing of Inter-plan transfers (type 04) has been improved so that transfer transactions from the transferor trustee and the transferee trustee are no longer linked.
For transfer transactions from the transferor trustee, we verify:
- the transferor trustee's contract number;
- the contract plan number of the transferor trustee and that of the transferee trustee;
- the calculation of the QESI balance, on the transaction date;
- the QESI amount transferred.
For transfer transactions from the transferee trustee, we verify:
- the Québec enterprise number (NEQ);
- the contract plan number of the transferee trustee.
We carry out checks to ensure compliance in our files. Note that mandataries are responsible for regulating their contracts.
End of note
Educational assistance payment (type 05)
This transaction allows a beneficiary eligible for educational assistance payments (EAPs) to receive the QESI amounts paid into their contract.
This transaction can be sent in the current year, i.e., the year the event occurs. In certain circumstances, it may be put on hold. In this case, an .att report will be sent to you. The transaction will automatically be included in the next production run, until it is accepted.
For more information and calculation examples, see the Guide for Mandataries – Educational Assistance Payment (SW-262-V).
End of note
Maximum EAP amount
A beneficiary cannot receive more than $3,600 as an educational assistance payment (EAP) attributable to the QESI in their lifetime.
If a beneficiary receives more than the $3,600 limit, they may have to pay a special tax equal to the amount of the excess when they file their income tax return.
- We don't send a notice to the beneficiary if the maximum amount of all their EAPs is exceeded.
- We calculate the QESI amount we have to pay into the contract for each beneficiary after receiving an Annual application for the QESI transaction (type 02).
- The EAP amount attributable to the QESI is calculated by the mandatary per the established rules.
End of note
Moving outside Québec
When a beneficiary moves outside Québec, they can retain the QESI amount paid into their contract. At that time, if they are eligible for the EAP, the EAP portion attributable to the QESI will be deemed to be zero. The QESI balance will remain in the contract in case the beneficiary returns to live in Québec and is still eligible for the EAP.
However, if the beneficiary never returns to live in Québec even though they're eligible for the EAP, the QESI amount cannot be paid. Based on the situation, the following solutions may apply:
- replacement by a recognized beneficiary;
- sharing between beneficiaries in a family plan;
- reimbursement after closing the contract.
Special tax return (type 06)
Various events and unforeseen circumstances may occur in a contract over the years. In most of the situations below, reimbursement of the QESI will be inevitable.
- Reasons 01, 02, 11, 31, 32, 41, 51 and 91 can be sent in the current year, i.e., the year the event occurs. They will be put on hold until the 90th day of the following year and an .att report will be sent to you.
- No Special tax return transaction (type 06), except for reasons 41, 51 and 91, causes a file or contract to close.
Unrecognized beneficiary replacement (type 06, reason 01)
Replacement of a former beneficiary by a new beneficiary, at a given time, is an unrecognized replacement in these cases:
- the new beneficiary turned 21 before the given time and was not, at that time, the brother or sister of the former beneficiary;
- neither beneficiary was, at the given time, related by blood or adoption to an original subscriber of the plan and one beneficiary had turned 21 before the given time.
Beneficiary who is not a brother/sister of the others (type 06, reason 02)
A trust governed by an RESP is required to pay a special tax for a given taxation year when an increase amount was paid to it and, during that year, an individual who is not the brother or sister of the plan's other beneficiaries becomes a beneficiary.
Unrecognized inter-plan transfer (type 06, reason 11)
A transfer of property from one trust governed by an RESP to another trust governed by an RESP made after December 31, 2010, is considered an authorized transfer when all the following conditions are met:
- Immediately before the transfer, a beneficiary of the transferee plan was:
- either a beneficiary of the transferor plan, or
- the brother or sister of a beneficiary of the transferor plan and
- either the transferee plan is a family plan, or
- the transferee plan is an individual plan whose beneficiary was under 21 at the time the contract constituting the plan was concluded.
- At the time of the transfer:
- either the transferee plan had only one beneficiary or, if it had several, they were all siblings, or;
- no increase amount was paid into the transferor RESP at the time of the transfer.
- The transferee plan meets the registration conditions set out in tax legislation applicable to education savings plans entered into after December 31, 1998.
- When the transfer is made after June 29, 2010, the trustee and the promoter of the transferee plan have, at the time of transfer, respectively entered into a trustee agreement and a promoter agreement.
As soon as one of these conditions is no longer met, the transfer is not an authorized transfer.
Form TP-1029.8.IQ-V, Québec Education Savings Incentive: Transfer Between Registered Education Savings Plans (RESP), helps trustees determine whether the transfer is authorized and to have in writing the information they need to create the required Inter-plan transactions (type 04).
Premature withdrawal of contributions (type 06, reason 22)
A trust governed by an RESP is required to pay a special tax for a given taxation year if a QESI-eligible contribution is withdrawn from the plan in that year (other than an eligible withdrawal or a transfer to another RESP) and none of the plan's beneficiaries is eligible for the EAP at the time of the withdrawal.
In the annual exercise to determine the net eligible contribution, if the amount is positive, an Annual application for the QESI (type 02) can be filed. If the total net contribuitions paid is negative, a Special tax return (type 06), reason 22 must be submitted.
Withdrawal and eligible beneficiary for the EAP (type 06, reason 23)
If a plan beneficiary is eligible for the EAP when contributions are withdrawn, no special tax is payable. However, the withdrawal must still be reported to us, whether the withdrawn contribution is paid to the subscriber or a beneficiary.
In the annual exercise to determine the net eligible contribution, if the amount is positive, an Annual application for the QESI (type 02) can be filed. If the total net contribuitions paid is negative, a Special tax return (type 06), reason 23 must be submitted.
Withdrawal of excess contributions (type 06, reason 24)
For this special tax, an eligible withdrawal is a withdrawal of all or part of the contributions that exceed the current $50,000 cumulative limit, provided the withdrawal serves to reduce the federal income tax payable by a plan subscriber on the excess contributions.
No special tax is payable, but the withdrawal must still be reported to us. Note that the date of the event is the withdrawal date, not December 31.
Payment made to an educational institution (type 06, reason 31)
An RESP may provide for payments to a designated Canadian educational institution at any time. This could be the case if a plan is left with a small fund after the subscriber withdrew contributions as a refund and one or more of the conditions for an accumulated income payment (AIP) were not met.
In general, any plan must provide that, if an amount remains in the plan and the conditions for an educational assistance payment or an AIP are not met, the amount in question will be paid to a designated educational institution in Canada or to a trust for the benefit of such an institution.
EAP made to a person other than the beneficiary (type 06, reason 32)
In some circumstances, a beneficiary other than the one named in the contract may receive the educational assistance payment.
AIP – Accumulated income payment (type 06, reason 41)
An accumulated income payment (AIP) may be made if all the following conditions are met:
- The payment is made to a plan subscriber or on their behalf.
- The subscriber is a Canadian resident at the time of the payment.
- One of these situations applies:
- The plan has been open for at least ten years, and each individual who is or was a beneficiary under the plan is over 21 and is no longer eligbile for the EAP.
- The plan was closed at the end of the 35th year following the year the contract was entered into (or the 40th year, for a specified plan).
- All plan beneficiaries are deceased.
- The plan must cease to exist before March 1 of the year following the year the AIP was paid.
- After submitting a reason 41 transaction, only a Revocation transaction (reason 51) or Closing transaction (reason 91) is accepted.
Revocation of plan's registration (type 06, reason 51)
If a trust fails to comply with any of its provisions, conditions of registration or other QESI obligations, its registration can be revoked.
Closing of contract (type 06, reason 91)
When the contract is closed with the promoter or when it reaches its maximum life (35 or 40 years), you must send us this transaction and close the contract.
Special tax for the premature withdrawal of contributions
A trust governed by an RESP is required to pay a special tax for a given taxation year if a QESI-eligible contribution is withdrawn from the plan before the beneficiary is eligible for the EAP.
Order for withdrawing contributions
For QESI and Special tax purposes, withdrawals of RESP contributions in a given year are deemed to have been made in the following order:
- contributions paid in the year and after February 20, 2007, in the order of payment (first in, first out);
- contributions paid in a previous year that qualified for the QESI, in the order of payment (first in, first out);
- contributions paid after February 20, 2007, in a previous year that did not qualify for the QESI, in the order of payment (first in, first out);
- contributions paid before February 21, 2007.
Closing a loss-making plan
When closing a loss-making plan, you must send us this information and the QESI amount remaining in the contract. Enter the write-off amount in position 065-073 of the Special tax return transaction (type 06), reason 91.
RESP expiration
A subscriber can contribute to an RESP for 31 years after it is opened. Although it's no longer possible to contribute to the plan after the 31st year, amounts can be transferred from one RESP to another.
Furthermore, the funds can be used until the end of the 35th year following the opening of the plan, i.e., before the RESP matures (unless otherwise specified in the plan's conditions). You must close the RESP contract at that time.
Special tax remittance slip
If you have a balance payable to repay the Special tax, you must use one of these remittance slips, based on the situation:
- Impôt spécial relatif à l'incitatif québécois à l'épargne-études – Solde à payer selon vos calculs (see courtesy translation TP-1129.66.6-T)
- Impôt spécial relatif à l'incitatif québécois à l'épargne-études – Solde à payer (see courtesy translation TP-1129.66.6.S-T)
You can pay online or by cheque or money order. For more information, see the instructions on the slip.
QESI history or balance request (type 11)
Since November 2022, all mandaries must have added the QESI history or balance request transaction (type 11) to their system.
This transaction is used to request, for a maximum of 1,000 contracts per file, the history of QESI transactions that we've registered and accepted or a contract's QESI balance for a given date. It allows you to:
- check the transactions we've accepted for a contract;
- see a contract's QESI balance for a given date;
- avoid receiving an unexpected notice of assessment (.cot) to be paid after a contract closing;
- ensure sound management of the QESI when RESPs involve events, such as inter-plan transfers.
You can send us this transaction 365 days of the year, as it's not linked to the production schedule. Please allow an average of 48 hours to receive your response file.
The response file for the QESI history or balance request details record is in Rejet.CSV or CSV format.