Lifelong Learning Plan
The Lifelong Learning Plan (LLP) allows you to withdraw amounts from RRSPs to finance training or education for you or your spouse (or common law partner.) You cannot use RRSP proceeds to finance your children's training or education however, nor the training or education of your spouse's children.
Similar to the Home Buyer Plan, you can withdraw up to $20,000 for for the purpose of training or education in a qualifying educational program at a designated educational institution. The premise behind the Lifelong Learning Plan is to encourage adults to invest in their own education for the benefit of potentially increasing future earnings power...
For more detailed information regarding eligibility and conditions of the Lifelong Learning Plan, please visit the Canada Revenue Agency website
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How much can be withdrawn under the Lifelong Learning Plan?
The maximum withdrawal is $20,000 (maximum of $10,000 in any year,) though the LLP can be tapped again and again (starting the year after the LLP balance is repaid.) The amount of the withddrawal is not limited to the amount of tuition or other education related expenses -- the final deadline for withdrawals is January of the fourth year after the year the initial withdrawal was made.
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Who is eligible?
Any individual who is resident of Canada, and who is the Annuitant (registered owner) of an RRSP that is not "locked-in" can withdraw moneys from their Plan as long as they or their spouse (or common law partner) are enrolled (full-time) in an eliglbe educaiton or training program. Participation in the LLP must be prior to the end of the year in which the student reaches the age of 71.
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Can you make an RRSP contribution and withdraw funds for education in the same year?
Regular and/or spousal RRSP contributions can be made in the same year as a planned LLP withdrawal, however 90 days must lapse before the LLP withdrawal is made otherwise the contribution will not be considered deductible.
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When do repayments begin?
Repayments to one's RRSP (or spousal plan) begin the second year after the last year the LLP student was entitled to claim the education amount on line 323 of their icnome tax return; or the 5th year after the first withdrawal, whichever comes first. The minimum repayment is equal to 1/10 of the LLP balance outstanding, otherwise missed repayments shall be included in taxable income.
