29 April 1999 External T.I. 9903495 - LIFELONG LEARNING PLAN QUALIFYING COURSES

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues: Qualifying educational program under the LLP

Position: Question of fact - general information provided

Reasons: General opinion only

XXXXXXXXXX
			990349
M. P. Sarazin
April 29, 1999

Dear Sir:

Re: Qualifying Educational Program for Purposes of the Lifelong Learning Plan

This is in reply to your e-mail message of January 20, 1999 addressed to The Honourable Herb Dhaliwal, wherein you asked whether the part-time executive MBA program offered by XXXXXXXXXX would be a qualifying educational program for purposes of the Lifelong Learning Plan ("LLP"). The expression "qualifying educational program" has the meaning assigned by proposed subsection 146.02(1) of the Income Tax Act (the "Act").

Comments

The determination of whether a specific program offered through a Canadian university will qualify as a qualifying educational program for purposes of the LLP is a question of fact. In order to make such a determination, we would have to have all of the facts related to the specific program. However, we can offer you the following general comments.

The LLP lets an individual withdraw up to $10,000 a year (to a $20,000 maximum) from his or her registered retirement savings plan ("RRSP") after 1998 to finance full-time training or education for the individual or his or her spouse. Before an individual can withdraw an amount from his or her RRSP under the LLP, the LLP student has to be enrolled in a qualifying educational program at a designated educational institution or the LLP student has to have received a written offer (a conditional written offer is acceptable) to enrol before March of the following year in a qualifying educational program at a designated educational institution.

A "qualifying educational program" is defined in proposed subsection 146.02(1) of the Act to mean a qualifying educational program (as defined in subsection 118.6(1) of the Act without reference to paragraphs (a) and (b) of that definition) at a designated educational institution for a period of not less than three consecutive months. A qualifying educational program must provide that the student spend not less than ten hours per week on courses or work in the program that is a program at a post-secondary school level.

The Act does not specify what constitutes courses or work for the purposes of the definition of qualifying educational program in subsection 118.6 (1) of the Act. However, the Department's general views, which would also apply to the LLP, can be found in paragraphs 14 to 19 of Interpretation Bulletin IT-515R, Education tax credit. We refer you to paragraph 15 of IT-515R wherein it states:

"Where the program of a student falls short of providing ten hours weekly of lectures, practical training and/or laboratory work, that student's time may be augmented by a reasonable estimate of time outside the classroom or laboratory, normally required and expected of a student during a particular program, for work assignments or other items listed below:

(a) after enrollment, taking a test at the beginning of a program to establish the program level at which the student will participate,

(b) taking an achievement test at the end of a program,

(c) essays

(d) term papers,

(e) other written work, and

(f) oral presentations."

The determination of whether a program that only consists of eight hours of class time per week will normally require or expect a student to spend an additional two or more hours per week for work, assignments or other items listed above is a question of fact. Generally, however, we would expect that the course load of a part-time executive MBA program consisting of eight hours per week of class time would normally require in excess of 10 hours per week of work in the program.

A designated educational institution is a university, college or other educational institution that qualifies for purposes of the education tax credit. Contact your tax services office if you are not sure whether a particular institution is a designated educational institution.

For more information regarding the LLP, you may want to get a copy of the Revenue Canada Guide titled Lifelong Learning Plan (LLP) RC4112(E) from your tax services office or you can access the guide on the Internet at www.rc.gc.ca. Other departmental publications, including interpretation bulletins, can also be found at this web site.

We trust these comments will be of assistance.

Yours truly,

Paul Lynch
for Director
Financial industries Division
Income Tax Rulings and
Interpretations Directorate