Withdrawing funds from your RRSP
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 that you make. After you fill out Part 1, 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.
- If you do not have an RRSP, you cannot set one up and then make a 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 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. To determine if part of the contribution is not deductible for any year, use the Appendix – Effect of LLP on RRSP deductions in the LLP guide.
You can withdraw up to a total of $20,000 from your RRSPs.
- Up to $10,000 in a calendar year; and
- Up to $20,000 in total.
You can participate in the LLP for:
- yourself while your spouse or common-law partner participates in the LLP for him or herself;
- you can both participate in the LLP for either of you; or
- you can participate in the LLP for each other.
Each of you can withdraw up to the annual LLP limit of $10,000 in a year and up to the total LLP limit of $20,000 over the period you are participating in the LLP.
The amount you withdraw is not limited to the amount of your tuition or other education expenses. As long as you meet all of the LLP conditions when you make the withdrawal, you can use the funds you withdrew for any purpose.
You can keep withdrawing amounts from your RRSPs until January of the fourth calendar year after the year you made your first LLP withdrawal, as long as the LLP student continues to meet the conditions and the 10-year repayment period has not begun.
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.
Your RRSP issuer will send you a T4RSP, Statement of RRSP Income, showing the amount you withdrew under the LLP and the amount of tax withheld at source. Attach this slip to your income tax and benefit return and fill out form Schedule 7 – RRSP and PRPP Unused Contributions, Transfers, and HBP or LLP Activities to report all LLP withdrawals made in the tax year.
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