It is time to start repaying your Canada Apprentice Loan when:
- you have completed your Red Seal Trade apprenticeship program;
- you are no longer registered in a Red Seal Trade apprenticeship program;
- you have reached your lifetime maximum of 6 years of interest-free status; or
- your registration is not confirmed by your Apprenticeship End Date.
You are not required to make payments for the first 6 months after your Apprenticeship End Date
. This is known as your non-repayment period
. However, during this period, interest starts to accrue on the principal amount of your outstanding loan balance
During the 6-month non-repayment period, you can choose to:
- start making payments right away;
- pay the 6 months’ interest as a lump sum before you start making your regular payments; or
- add the interest amount to your outstanding loan balance.
No matter when you choose to pay the accrued interest, you will receive a tax credit for the interest you have paid.
You can estimate your monthly payment by using the (opens in a new window)Loan Repayment Estimator
. The amount you pay over and above your monthly payment is applied directly toward the principal amount of your loan. This decreases the length of time it will take you to repay your loan and the total interest you will have to pay over time.
At the end of the 6-month non-repayment period, you will be required to start making regular loan payments. We will notify you, using your preferred method of communication (online/paper), before your loan enters repayment. It is important that you keep your contact information on file up to date.
If you do not make contact, your loan payments may start to be automatically withdrawn after the 6-month non-repayment period from the same bank account where your loans were deposited (if you had arranged for direct deposit).
You will receive a repayment notification in the mail regarding your Canada Apprentice Loan during the last month of your non-repayment period with your repayment details. If you do not receive anything by mail, make sure to contact us
before your 6 month non-repayment period is over.
You will want to review all aspects of your loan, including:
- how much you owe;
- repayment start date;
- the interest rate and type that will apply to your loan;
- your monthly or bi-weekly payment amount;
- the date your payment will be withdrawn from your bank account (if you are set up for pre-authorized debit);
- how to make payments (if you are not set up for pre-authorized debit); and
- how long it will take to pay back your loan.
Payments can be made via automatic pre-authorized debit, cheque, online banking or telephone banking.
There are various options that can help make the repayment of your loan more suitable to your needs. For more information visit Customize Your Loan Repayment
Government of Canada Tax Credits for Apprentice Loans
You will receive a 15% tax credit on the interest you pay on your Canada Apprentice Loan each year.
The necessary documents will be sent to you before you file your taxes.
Help Repaying Your Loan
Need help in order to manage your apprentice loan debt? Having difficulty repaying your Canada Apprentice Loan? Missing payments can affect your credit rating and have serious and long-term consequences.
The federal government can provide you with a number of repayment options that can lower your payments, or put them on hold until you can afford them. Enrolment is not automatic; you must apply
- Through the Repayment Assistance Plan (RAP) you may qualify for a reduced monthly payment or no monthly payment.
- Through the Repayment Assistance Plan for Borrowers with a Permanent Disability (RAP-PD) you may qualify for a reduced monthly payment (or no monthly payment at all) and receive financial help with expenses related to your disability.
- You may be eligible to have your loan forgiven through the Severe Permanent Disability Benefit if you have a severe permanent disability that prevents you from performing the daily activities necessary to participate in an apprenticeship program and in the labour force, and you expect to continue having this severe disability for the rest of your expected life.
- Under the Revision of Terms measure, you can ask to have your loan payments decreased if you are having difficulty repaying your debt, or increased if you wish to pay your debt off more quickly.
If you have additional questions or you need help repaying your Canada Apprentice Loan, contact us
Bringing Your Canada Apprentice Loan out of Collection
If you miss payments on your Canada Apprentice Loan for 270 days (9 months) or more, your loan is considered to be in default and is sent to the Canada Revenue Agency (CRA) for collection. Canada Apprentice Loan rehabilitation
is an opportunity to have your loan returned from the CRA and improve your payment history.
If you have a judgment or legal action on your account, you may not be eligible for Canada Apprentice Loan rehabilitation. Contact us to:
- determine whether you are eligible for Canada Apprentice Loan Rehabilitation;
- arrange a repayment schedule with the CRA;
- repay all interest owed; and
- make the equivalent of 2 monthly payments, at the agreed monthly payment rate set out in your repayment schedule with the CRA.
Note, the CRA may allow you to make a lump sum payment combining the 2 monthly payments and the interest owed.
Once you have completed your payments, you will need to inform us that you have fulfilled the requirements to rehabilitate your loan.