If you withdraw more from your RRSP than the annual limit, the excess amount will be added to your income in 2018 and you’ll have to pay tax on it.
Under the Lifelong Learning Plan (LLP), you’re allowed to withdraw up to $10,000 from your RRSPs each calendar year to help you cover the costs of enrolling in a post-secondary program, with a maximum of $20,000 each time you participate in an LLP. Your yearly limit amount of $10,000 is known as your annual LLP limit, and it’s not limited to the amount of tuition or other education expenses you might have. Your maximum LLP withdrawal amount of $20,000 is known as your total LLP limit.
If you withdraw more than the annual LLP limit, the excess amount will be added to your income for the year of the withdrawal, but it won’t reduce your total LLP limit of $20,000.
Remember, you can participate in the LLP again, beginning in the year after you bring your LLP balance to zero. For more information, refer to the Canada Revenue Agency (CRA) website.
Note: Your spouse or common-law partner (if applicable) can also withdraw $10,000 from their RRSPs under the LLP in the same year you do.
Where can I learn more?
- Repayments to the Lifelong Learning Plan (LLP) (H&R Block Online Help Centre article)