Lifelong Learning Plan Withdrawals
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Lifelong Learning Plan Withdrawals
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How to make withdrawals in the Lifelong Learning Plan (LLP)
To make an LLP withdrawal, use Form RC96, Lifelong Learning Plan (LLP) Request to Withdraw Funds from an RRSP. You have to fill out Form RC96 for each withdrawal you make.
Fill out Part 1 of Form RC96. You can name yourself or your spouse or common-law partner as the LLP student in Part 1. After you fill out this part, give the form to your RRSP issuer, who will fill out Part 2.
Your RRSP issuer will not withhold tax from the funds you withdraw if you meet the LLP conditions. Your RRSP issuer will send you a T4RSP slip, Statement of RRSP Income showing the amount you withdrew under the LLP in box 25. Attach this slip to your income tax and benefit return.
Filing an income tax and benefit return
Starting in the year you make your first LLP withdrawal, you have to file an income tax and benefit return every year until you have repaid all your LLP withdrawals or included them in your income. You have to send us an income tax and benefit return even if you do not owe any tax, or you did not make a repayment to your RRSP.
Fill out Schedule 7, RRSP, PRPP and SPP Contributions and Transfers, and HBP or LLP Activities (included in your income tax package) and attach it to your income tax and benefit return to show the LLP withdrawals or the repayments made in the tax year. This will help both you and us to keep track of them.
When you report a withdrawal on the Schedule 7, tick Box 26400 if your spouse or common-law partner is the student. If you do not make this indication, we will assume that you are the designated student. If withdrawals are made in different years, the student indicated must remain the same or your withdrawal may be considered ineligible.
How much you can withdraw
Under the LLP, you can withdraw up to $10,000 from your RRSPs in a calendar year. This is your annual LLP limit. The amount you withdraw is not limited to the amount of tuition or other education expenses. Your spouse or common-law partner can also withdraw up to $10,000 from their RRSPs under the LLP in the same year you do. For more information, go to Can my spouse or common-law partner and I participate in the LLP at the same time?.
You cannot withdraw more than $20,000 each time you participate in the LLP. This is your total LLP limit. You can participate in the LLP again, starting the year after you bring your LLP balance to zero.
If you withdraw more than the annual LLP limit of $10,000, the excess will be included in your income for the year of the withdrawal. The excess does not reduce your total LLP limit of $20,000.
If you withdraw more than the total LLP limit of $20,000, the excess will be included in your income for the year you exceed the total LLP limit.
When you can make LLP withdrawals
As long as the LLP student continues to meet the LLP conditions (see Conditions the LLP student has to meet), you can keep withdrawing amounts from your RRSPs until the earliest of the following:
- the commencement of your repayment period
- January of the fourth calendar year after the year you made your first LLP withdrawal
You may not make additional LLP withdrawals until the year after your previous LLP balance is zero.
- Example 1
Carlos made LLP withdrawals of $10,000 in 2018 and $5,000 in 2019 because his spouse was attending university. His spouse files income tax and benefit returns every year indicating she is enrolled in a full-time program. Carlos would like to withdraw another $5,000 in 2023. However, even though his spouse is still in school, he will have to start repaying his previous $15,000 withdrawals in 2023 and any 2023 withdrawal would be considered as ineligible and taxable.
- Example 2
Nadia made her first LLP withdrawal in 2021 for herself as the LLP student and completed the program the same year. She was not a student in 2022 or in 2023. However, in 2023 she enrolled full time in a program beginning in January 2024 and would like to make another LLP withdrawal. Since Nadia will have to start repaying her 2021 withdrawal in 2023 (see chart When to start repaying your LLP withdrawals) she cannot make another LLP withdrawal in 2023 nor in subsequent years until the year after her first withdrawal has been fully repaid.
- Example 3
Angela made an LLP withdrawal of $5,000 in 2013 because her spouse was enrolled full-time in a program that year. Her repayment period started in 2015 and she has been making a $500 repayment each year. In 2024, she decided to return to school and would like to make a withdrawal of $10,000. Such a withdrawal would not be eligible unless she made contributions to her RRSP, PRPP or SPP and chooses to fully repay the remaining $1,000 by making the designation in Part B on Schedule 7 of her 2023 income tax and benefit return. If she does so, she could then start a new participation period beginning in 2024 and designate herself as the student.
How the withdrawal from your RRSP affects your RRSP deduction
You can continue to contribute to your RRSP, PRPP or SPP and deduct your contributions from your income on your income tax and benefit return after you have made an LLP withdrawal from your RRSP. However, you may not be able to deduct contributions you made before the withdrawal from your RRSP. The following explains the restrictions that apply.
If you do not have an RRSP, you cannot set one up and then make an LLP withdrawal immediately. The contribution has to be in the RRSP for 90 days before you can deduct it from your income on your income tax and benefit return.
If you already have an RRSP and you contribute to it in the 89-day period before you make an LLP withdrawal, you may not be able to deduct the contribution from your income on your income tax and benefit return even if you repay this amount to your RRSP under the LLP. If the value of the RRSP right after the LLP withdrawal is more than or the same as the amount of the RRSP contribution, you can deduct the entire contribution. If the value of the RRSP right after the LLP withdrawal is less than the amount of the RRSP contribution, you cannot deduct either a portion or all of the contribution.
To find out how much you cannot deduct, use the following formula for each RRSP from which you make an LLP withdrawal:
Total contributions you made to the RRSP in the 89-day period before the LLP withdrawal
Minus:
Value of the RRSP immediately after you made the LLP withdrawal
Equals:
The part of the contributions you cannot deduct at any time
Stephen has an RRSP with a value of $6,500. He contributes $8,000 to the RRSP on February 10, 2023. He then makes an LLP withdrawal of $10,000 on March 1, 2023. The value of the RRSP after the withdrawal is $4,500.
February 10, 2023
Value of RRSP before contribution
February 10, 2023 contribution
Value after contribution
March 1, 2023
LLP withdrawal
Value after withdrawal
Stephen determines the part of his contribution that is not deductible as follows:
Contribution in the 89-day period before the LLP withdrawal
Minus: the value after the withdrawal
Result
Stephen cannot deduct $3,500 of the contribution he made on February 10, 2023, for any year.
If the LLP student leaves the educational program
For you to be able to repay the LLP withdrawals over a 10-year period, the LLP student usually has to meet one of the following conditions:
- complete the program
- continue to be enrolled in the educational program at the end of March of the year after the LLP withdrawal
If the LLP student leaves the program before April of the year after the withdrawal, you can still make your repayments over a 10-year period if less than 75% of the student's tuition is refundable by the educational institution.
If the LLP student leaves the program before April of the year after the withdrawal, and 75% or more of the LLP student's tuition is refundable, you have to cancel the LLP withdrawal. For more information, see How to cancel your LLP withdrawal. If you do not cancel it, the amount you withdrew will be included in your income for the year you withdrew it.
We check the LLP student's enrolment on line 32010 and 32020 of Schedule 11 of their income tax and benefit return for the year you make the withdrawal and for the following year.
If we cannot determine that the LLP student has continued in the program, we will contact you to find out if you still meet the conditions to make the repayments over a 10-year period.
- Example 5
In September 2023, George withdraws $1,000 from his RRSPs under the LLP. Earlier in the same month, he enrolled in a four-month college program and paid $750 in tuition fees. George completes the program in January 2024. Therefore, he can repay his LLP amounts over a 10-year period.
Note
Special rules apply if the LLP participant dies. For more information, see If the person who made the LLP withdrawal dies.
- Can I make LLP withdrawals from more than one RRSP?
You can make LLP withdrawals for you or your spouse or common-law partner from more than one RRSP as long as you are the annuitant of each RRSP. Your RRSP issuer will not withhold tax on these amounts. Although the maximum amount you can withdraw each time you participate is $20,000, there is an annual withdrawal limit of $10,000.
Note
Similar to locked-in RRSPs, PRPPs and SPPs do not allow for LLP withdrawals. However, you can designate your PRPP and SPP contributions as an LLP repayment.
- Can I make LLP withdrawals for other purposes?
As long as you meet all the LLP conditions when you make the withdrawal, you can use the funds you withdrew for any purpose.
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- Date modified:
- 2023-11-30