RESP's are not trust accounts?

andied · Post by **andied** » Sun Mar 07, 2010 1:31 pm

or so says a financial adviser for a major Cdn bank.

My adult daughter (dual citizen) was advised to open an RESP; I advised against it due to foreign trust reporting implications and my daughter then notified the financial adviser, who then sent her the following message:

"I have checked around and as RESPs are not trust accounts, you should have no problems. The capital in RESPs go back to the parents who then give it to the kids. The grant portion goes to the kid or back to the government, so it is not classified as a trust at all."

Any possible truth to the above or just an excellent example of ill informed people providing financial advice?

nelsona · Post by **nelsona** » Sun Mar 07, 2010 5:09 pm

They are:
http://www.bdo.ca/library/publications/ ... 031708.cfm

Your banker is a salesman.

JohnSt · Post by **JohnSt** » Mon Mar 22, 2010 12:21 pm

The answer may depend on whether you're in Canada or the US (or CRA versus the IRS):

http://www.cle.bc.ca/Practice%20Points/ ... criber.pdf

nelsona · Post by **nelsona** » Mon Mar 22, 2010 12:49 pm

In this discussion, it is IRS that matters: It's a foreign trust.