The Lifelong Learning Plan (LLP) lets you take up to $10,000 per year (up to a $20,000 total) from your RRSP to pay for full-time education or training for yourself or your spouse. It’s a smart way to invest in your skills without paying taxes on the withdrawal right away. As long as you meet the program’s rules and repay the amount over time, LLP withdrawals aren’t taxed as income. Here’s what you need to know about eligibility, withdrawal rules, and repayment.
Eligibility Requirements
To qualify for the LLP, you must meet the following criteria:
- Full-Time Student: You or your spouse must be enrolled in a full-time program at a designated educational institution. A full-time program typically means you are taking at least 10 hours of courses or work each week, but exceptions can be made if you or your spouse has a disability.
- Eligible Educational Program: The program must run for at least three consecutive months and provide skills or training that improve occupational or professional skills.
- Canadian Resident: You must be a resident of Canada at the time of withdrawal and when the funds are used.
- First-Time Use: The student must not have used the LLP for the same program in the previous calendar year.
How to Apply for the Lifelong Learning Plan
- Fill Out the LLP Form: Complete CRA Form RC96 to request an LLP withdrawal. Download the form attached to this article.
- Do Not Initiate Withdrawal in Portal: The withdrawal will be manually processed on our end. Please do not submit a withdrawal request through your online plan portal.
- Update Banking Information: Log into your plan on the desktop version, click on your name in the top right corner, and select "Update my personal information." Make sure your banking details are up to date to receive funds.
- Submit the Form: Send your completed form through our support portal: Submit LLP Form.
- Wait for Processing: After submission, it will take 10-14 business days to process your LLP withdrawal. You will be notified when the transaction is complete.
- Fees: A transaction fee of $35 plus tax will apply when the withdrawal is processed.
Withdrawal Rules and Limits
When withdrawing funds under the LLP, the following rules and limits apply:
- Maximum Withdrawal Amount: You can withdraw up to $10,000 per calendar year, with a total maximum of $20,000.
- RRSP Holding Period: The contributions you withdraw must have been in your RRSP for at least 90 days before they are eligible for withdrawal under the LLP.
- Multiple Withdrawals: You can make multiple withdrawals over several years, up to the maximum limit, as long as you remain eligible.