Principal Issues: Is a student enrolled in an education program at an educational institution that requires the student to spend 16 hours per week on the program, considered to be a full-time student for purposes of participating in the lifelong learning plan (LLP)
Position: Question of fact.
Reasons: The student must be enrolled in a qualifying educational program at a designated educational institution as a full-time student. If the educational institution considers the student to be enrolled full-time, then the full-time requirement for purposes of participation in the LLP is satisfied.
XXXXXXXXXX 2004-009321 G. Allen October 6, 2004
Dear XXXXXXXXXX:
Re: Eligibility for the Lifelong Learning Plan (LLP)
This letter is in response to your letter dated August 31, 2004 wherein you requested our comments concerning your eligibility for participation in the LLP.
Written confirmation of the tax implications inherent in particular transactions are given by this Directorate only where the transactions are proposed and are the subject matter of an advance income tax ruling request. For more information concerning advance tax rulings, please refer to Information Circular 70-6R5 dated May 17, 2002. Copies of information circulars and other publications are available at your local Tax Services Offices or on the Internet at http://www.ccra-adrc.gc.ca/formspubs/menu-e.html. Where the particular transactions are completed, the enquiry should be addressed to the relevant Tax Services Office. However, we are prepared to provide the following general comments, which may be of assistance.
The LLP permits an individual to withdraw an "eligible amount", as defined in subsection 146.02(1) of the Income Tax Act (the "Act"), from their registered retirement savings plan ("RRSP") to finance training or education for the individual or their spouse or common-law partner.
In order to qualify as an "eligible amount" within the meaning assigned by subsection 146.02(1) of the Act, the designated person (the student attending school) has to be enrolled at the particular time as a full-time student in a qualifying educational program or has received written notification before the particular time that the designated person is absolutely or contingently entitled to enrol before March of the following year as a full-time student in a qualifying educational program. Thus, both requirements that the student be a "full-time student" and that the student be enrolled in a "qualifying education program" must be satisfied.
In general, a "qualifying educational program", as defined in subsection 146.02(1) of the Act, is an educational program at a designated educational institution that lasts for a period of not less than three consecutive months and requires that the student spend not less than ten hours per week on courses or work in the program.
The term "full-time student" is not defined for purposes of the LLP except to extend it to include mentally or physically impaired students enrolled on a part-time basis by reference to subsection 118.6(3) of the Act. Paragraphs 5 to 7 of IT-515R2 provide general comments regarding the Canada Revenue Agency's interpretation of "full-time student". It is our position that it is the responsibility of the educational institution to determine whether or not the designated person is considered to be a full-time student. It should be noted that even if the student is enrolled in a program that requires spending 10 hours or more per week on courses or work in the program, it would not be eligible for the LLP if the institution considered the student to be part-time. We would refer you to page 5 of RC4112, the Lifelong Learning Plan guide, under the heading, "Who can be enrolled on a part-time basis?", for comments concerning the participation of part-time students in the LLP.
We trust that the above comments will be of assistance to you.
Yours truly,
Roberta Albert, CA
for Director
Financial Industries Division
Income Tax Rulings Directorate
Policy and Planning Branch