16 February 1999 Internal T.I. 9901587 - LIFELONG LEARNING PLAN - WITHDRAWAL

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: Would an amount received after the student has completed her/his program be an “excluded withdrawal” under the LLP?

Position: No.

Reasons: Wording of 146.02(1).

February 16, 1999

CHARLOTTETOWN TSO HEADQUARTERS
Income Tax Ruling and
Attention: Sharon Bulger Interpretations Directorate
Client Services Fouad Daaboul
(613) 957-2087

		990158

“Excluded Withdrawal” under the Lifelong Learning Plan (“LLP”)

This is in reply to your facsimile submission of January 21, 1999, wherein you requested our views in the following scenario: will a student qualify to make a withdrawal in 1999 under the LLP if the student is enrolled in a course lasting from October 1998 to the end of February 1999?

Although your query addresses a specific date where the LLP rules are not yet law, we can provide you with our general comments on this draft legislation.

As defined in proposed subsection 146.02(1), the term “excluded withdrawal” is generally an eligible amount that is received by an individual out of or under the individual’s or the individual’s spouse’s RRSP. An excluded withdrawal is not immediately included in computing income.

The term “eligible amount” in proposed subsection 146.02(1) means an amount received at a particular time subject to certain conditions including paragraph (f) of this subsection. Paragraph (f) requires that the LLP student be enrolled at the particular time, or be entitled to enrol before March of the following year, in a qualifying educational program (“QEP”). It is our view that an amount is considered to be “eligible amount” only where such an amount is received at the time the LLP student is enrolled in a QEP or is entitled to enrol before March of the following year. Thus a withdrawal from a RRSP made at a time after a course is completed will not be an eligible amount in respect of that course.

We trust our comments will be of assistance to you. Should you wish to discuss our comments further do not hesitate to call us.

Paul Lynch
for Director
Financial Industries Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch