Will OSAP reduce loan and grants/bursary if told I have RESP?

  • Last Updated:
  • Feb 7th, 2018 12:39 pm
Jul 27, 2008
61 posts
Kasakato wrote:
Jun 28th, 2012 11:58 pm
Your income within the specified time periods must include RESP.
I checked with financial Aid Office they said if I am not using RESP this year than I do not need to show RESP income.

The 2nd point I do not understand why some one will show 15 k RESP as income when may be 10 to 12 k is parent contribution on which they already paid taxes on as RESP contribution are after tax dollars. therefore, in real term your growth and Govt contribution is income.
Deal Expert
User avatar
Jun 9, 2003
23801 posts
Markham, ON
Heero01 wrote:
Jun 20th, 2012 10:18 pm
Yes unfortunately.

Well now you learned your lesson. You should be like everyone else and not plan for your future so that you get more money. VERY broken system.

I have an RESP - go to school full time. Pay my own tuition, car, rent. Parents contribute zero. I do not get osap either because of family income. Luckily I just barely get tuition rebate.

System is extremely broken. It punishes you for planning ahead and saving for education while it rewards the poor with interest free money. Its crazy how so many of my friends are not doing any work, living off OSAP and then plan to not pay loan after.
So you contributed to the RESP?
Dec 22, 2014
87 posts
Peterborough, ON
Any update on this? the OSAP aid estimator doesn't ask how much you are cashing out of your RESP, and when you run the estimator with (or without) the RESP box checked, it doesn't seem to make a difference.

Jul 31, 2014
9 posts
1 upvote
Thunder Bay, ON
Anyone got feedback from OSAP regarding savings/RESP amount?
Jr. Member
Jan 6, 2008
171 posts
Does it matter if the RESP is in my parents name? Would OSAP know if they withdraw funds for my tuition?
Deal Addict
Jan 21, 2014
3150 posts
luck11 wrote:
Apr 19th, 2017 9:02 pm
Does it matter if the RESP is in my parents name? Would OSAP know if they withdraw funds for my tuition?
If you withdraw funds from the grant/gain portion, financial institution will have it go to your bank account or cheque with your name as the recipient and issue tax receipt under your name, not your parents
Oct 30, 2012
63 posts
I wish I had come across this thread earlier as I just learned an expensive lesson. Please take OSAP applications very seriously.

I had an RESP for my daughter that I did not use in first year but did use in second year. I withdrew $20,000 of which $17,600 was from the income/grant portion (bad advice from the Bank of Montreal rep but that's another story). My daughter phoned me late one night and asked me how much I'd taken out of the RESP. I figured $10,000 for first year, $10,000 for second year, I put $5,000 back in for my second daughter so figured $7000 would be a good amount to report. WRONG! $17,600 showed up on a T4A slip in my daughters name sometime later, I'd forgotten about our conversation so didn't bother to correct the OSAP information. In November of her 3rd year we got a letter from OSAP indicating that she had been suspended from OSAP for 5 years for under reporting income but that we could re-report the amount withdrawn from OSAP (a letter from the bank) and a copy of all of her pay stubs from her summer job as an appeal, which we did.

We just got the results of the appeal which was a 1 year suspension. Which means no grants (which the RESP amount would not have affected anyway), and no loans for the next 2 terms. Plus, we'll have to pay back all of the loans she has received to date before she can be re-instated for the 2nd term of her 4th year. It cost me $1,960 in lost grants and whatever interest I'll have to pay on the $18,000 in loans that will now have to go onto my line of credit. Pretty harsh treatment, especially since the incorrectly reported amount wouldn't have made much difference in the loan amount (didn't really care any way) and we needlessly lost the 30% tuition grants (which really hurts).

Make sure of the amounts when you apply for OSAP even if you don't think they'll make much difference in your funding, or your feeling a little lazy like I was. Their penalties are harsh and merciless!