Grandfather A, who resides in the U.S., subscribed to a registered education saving plan (‘RESP”) for his Canadian-resident granddaughter, but now wishes for the subscriber to be changed to his son (the girl’s father). The CRA website indicates that it is possible to transfer amounts in a RESP to another RESP with a different subscriber and the same beneficiary. How is this possible given the prohibition under the s. 146.1(1) definition of “subscriber” against changing the subscriber? CRA responded:
Such a transfer will be possible subject to the terms of the arrangement with the promoter. The provisions applicable to RESPs allow the transfer of amounts from one RESP to another. In fact, subsection 146.1(6.1) provides special rules for transfers of property from one RESP to another. …
[P]aragraph [146.1(6.1)(b)] could cause the years of existence of the transferring RESP to be taken into account in determining when "accumulated income payments" may be made under the receiving RESP pursuant to 146.1(2)(d.1). If applicable, those years would also be taken into account in determining the maximum duration of the receiving RESP provided in paragraph 146.1(2)(i) and determining the period during which contributions may be made into the receiving RESP pursuant to paragraph 146.1(2)(h). …
However, depending on the circumstances, a transfer between RESPs could result in the subscriber of the transferring RESP, the receiving RESP, or both, having to pay tax under subsection 204.91(1) … [but not in] the situation described … .