(This post is only applicable to Canadian residents.)
The principal of a RRSP is only taxed once during its lifespan, upon its payout. On the other hand, the principal of a RESP gets taxed twice during its lifespan, i.e. it's already post-income tax money when the subscriber (parent) contributes it into a RESP account and then is taxed again under the name of the beneficiary (child) when she receives it later on.
I'm ruminating over the reasons why they're designed so by the Canadian government and can't grasp them yet.
No comments:
Post a Comment