The Canada Learning Bond explained

Your child’s post-secondary education is an important savings goal and helping them cover the cost can make a meaningful difference in their life down the road. In Canada, the cost of a single year of post-secondary tuition can range from $2,500 to $11,400, so having a plan to pay for your child’s degree or diploma is essential, especially if you have more than one future student.

Opening a Registered Education Savings Plan (RESP) for each child and contributing what you can is a good start. But to make saving easier, the federal government offers the Canada Learning Bond (CLB) to help families within a certain income threshold start building their education savings.

Let’s break down how the program works and how your family can take advantage of it.

What is an RESP?

The Registered Education Savings Plan (RESP) is a long-term savings account that allows you to set aside money for your child’s or children’s post-secondary education. You can open an RESP at most financial institutions and name your child or children as the beneficiary or beneficiaries.

With an RESP, your contributions can grow inside the account on a tax-deferred basis until they’re withdrawn to pay for tuition or other eligible educational costs. Withdrawals are taxed in your child’s name, which could result in low or no tax, as young adults generally are in a low marginal tax bracket.

Even small contributions can make a difference. Once you open an RESP, your child may also become eligible for government benefits, such as the CLB.

What is the CLB?

The Canada Learning Bond (CLB) helps kids from eligible families build education savings. You simply need to open an RESP account and apply.

In the first year your child qualifies for the CLB, $500 will be deposited into their RESP. After that, they receive an additional $100 for each year they remain eligible, up to and including age 15, for a maximum of $2,000.

Keep in mind that annual payments aren’t guaranteed, since eligibility depends on income and is reassessed each year by the Canada Revenue Agency (CRA), based on your family’s adjusted income from the previous year.

Who is eligible for the CLB?

To be eligible, your child must be named as the beneficiary of the RESP account used to apply for the CLB. Eligibility also requires that your child be a Canadian resident, have a Social Insurance Number, have been born on or after January 1, 2004, and that your family is in a lower income bracket.

For the benefit year July 1, 2025 to June 30, 2026, families with up to three children must have an adjusted net family income of $57,375 or less. The threshold increases for larger families:

• For four children, it should be less than $64,733
• For five children, it should be less than $72,123
• For six or more children, it’s recommended to reach out to the CRA directly

In addition to meeting the income requirements, you must have filed your taxes for the years in which you’re applying for the CLB on behalf of your child.

How to apply

When you open an RESP, your financial institution can help you complete the CLB application. The application is then submitted to the CRA, which determines your eligibility. If you qualify, deposits are made automatically into your child’s RESP, and you don’t need to reapply each year.

It’s important to note that you don’t have to contribute to your child’s RESP to qualify for the CLB; you only need to open the account.

Your child’s eligibility over time

If your income increases and your family no longer qualifies, the CLB payments will pause, but any money already deposited remains in your child’s RESP.

The benefit is also retroactive, so it’s worth checking whether your child was eligible in previous years to receive additional payments. A financial advisor or your RESP provider can help confirm this and ensure your family receives any missed payments.

Note: All costs included in this article are estimates and may vary depending on the property, location and other circumstantial factors.