The short answer is yes. The long answer needs some more explaining. Remember that there are different types of RESP withdrawals. One type is called an Education Assistance Payment which can be used to pay any schooling expense including OSAP. Another type of withdrawal is the repayment of contributions which can be taken out without restrictions if the child is enrolled in post-secondary education. For these withdrawals, there are no longer any rules about how the money is spent. That’s considered to be savings, no strings attached. In fact, this money can also be spent by the person who started the RESP—that’s up to them!
The last type is called accumulated income payments (AIPs). This is the withdrawal of any remaining investment earnings by the person who started the RESP if the plan qualifies. It can be withdrawn as cash less a tax penalty or transferred tax free to an RRSP provided there is contribution room. Any unpaid government grants must be returned to the government.
Here at CST Spark, although we love getting to know our customers, we don’t ask you what you’re spending your RESP money on, or collect receipts. But, we encourage students and parents to reach out to the Canada Revenue Agency with any questions about what expenses are eligible.