Quote:
Originally Posted by yyjvisitor
If you invested $27,500 in a non registered account and then move $2500 each year to maximize the grant money, what tax event would you trigger? My understanding is the tax free gains in a RESP thru the life of the plan and if it was in a non registered account there will be capitals gains with the transfer and the compounding return
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Well that could be a factor as well. You would have to sit down and go through the math, but otherwise you could have capital gains tax to pay. I doubt that this cost outweighs a $500 guaranteed grant though? Some of the $2500 would be capital gains say in year two but not all of it. It would also depend on what you are invested in while you wait to make the contributions, but you could be paying a minimal capital gains tax to get the $500 grant.
Alternatively you could pull funds from the TFSA (assuming you have one) and pay no tax to make the contributions. There is a lot to consider really.