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Tax and Accounts

Lifelong Learning Plan (LLP)

Allows an RRSP holder to withdraw up to $10,000 per year (maximum $20,000 total) for full-time education or training, repayable over 10 years.

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Definition

The LLP lets an RRSP holder (or their spouse) withdraw from their RRSP to finance full-time qualifying education at a designated educational institution. Annual withdrawals are capped at $10,000, with a lifetime LLP limit of $20,000. The withdrawals are not included in income in the year of withdrawal. Repayment starts no later than 60 days after the tenth year following the first LLP withdrawal, and the full balance must be repaid over a maximum of 10 years; if annual repayments are not made, the unpaid designated amount is added to income. Unlike the HBP, the LLP can be used more than once, provided all prior LLP balances are fully repaid and the qualifying student re-qualifies. The RRSP must have been held for at least 90 days before a withdrawal to prevent the deposit-and-withdraw tax benefit from accruing on very recent contributions.

Source

Income Tax Act s.146.02; CRA RC4112 (Lifelong Learning Plan)

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