Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues: Can a $4000 contribution to an RESP which was allocated in error to one beneficiary instead of being divided equally between the two beneficiaries of the plan be re-allocated so that additional Canada Education Savings Grant may be receivable?
Position: Yes, but whether such a re-allocation is acceptable for CESG purposes is at the discretion of Human Resources Development Canada, not the CCRA.
Reasons: The provisions of the Act are not offended.
XXXXXXXXXX 2000-007199
G. Kauppinen
April 10, 2001
Dear XXXXXXXXXX:
Re: Registered Education Savings Plan ("RESP")
This is in reply to your facsimile transmissions dated February 26 and March 16, 2001 regarding contributions to RESPs.
Specifically, you advise that for the 1999 taxation year one of your clients made a $4000 contribution to an RESP that was allocated in error entirely to one beneficiary of the plan rather than being divided equally between the two beneficiaries of the RESP as was intended. As a result, only the first $2000 of the contribution attracted Canada Education Savings Grant ("CESG").
You have asked if the contribution can now be re-allocated and divided equally between the two beneficiaries of the RESP.
With your facsimile transmission dated March 16, 2001, you have attached copies of correspondence from other clients of yours with similar situations.
There is no provision in the Income Tax Act to prevent such a re-allocation.
However, whether such a re-allocation of the contribution is acceptable for the purpose of the CESGs payable for 1999 is at the discretion of Human Resources Development Canada ("HRDC") and not the Canada Customs and Revenue Agency.
We have been advised by Ms. Sue Waugh of HRDC that you should send your enquiries to her attention:
1. By E-mail to:
eesg-scee@hrdc-drhc.gc.ca
2. By regular mail to:
170 Hotel de Ville, 8th Floor
Hull QC J8X 4C2
We trust our comments will be of assistance to you.
Yours truly,
Roberta Albert, CA
for Director
Financial Industries Division
Income Tax Rulings Directorate
Policy and Legislation Branch
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