9 July 2002 External T.I. 2002-0122195 - TUITION FEES

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CCRA.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ADRC.

Principal Issues:

Can a resident parent claim the tuition fee transfer for a student resident of a foreign country?

Position TAKEN

Depends on whether the student is a taxpayer and is liable for Part I tax.

Reasons FOR POSITION TAKEN
Wording of IT Bulletin IT 515R2 and IT516R2

XXXXXXXXXX 2002-012219
C. Tremblay, CMA
July 9, 2002

Dear XXXXXXXXXX:

Re: Tuition fee - transfer from a non-resident student

This is in reply to your letter of January 30, 2002, requesting our opinion on whether a resident of Canada, who will be paying his son's tuition fees, is allowed to claim the tuition tax credit on his own return. You state that the student has no income, is a resident of XXXXXXXXXX, and does not file a tax return in Canada. We apologize for the delay.

Our Comments:

The particular circumstance on which you have asked for our views relates to a factual situation and proposed transactions. As explained in Information Circular 70-6R5, it is not this Directorate's practice to comment on proposed transactions involving specific taxpayers other than in the form of an advance income tax ruling. The details of the proposed transactions, including all relevant facts and documentation, should be submitted as part of an advance income tax ruling request. We are, however, prepared to offer the following general comments, which may be of assistance.

Although a student is not required to be either a resident or a deemed resident of Canada in order to be able to transfer his or her tuition fees, in our view, unless the student is considered a taxpayer and liable for tax under Part I of the Income Tax Act (the "Act"), there is no tuition tax credit available to be transferred, and accordingly, the resident parent would not be entitled to a tax credit for the student's tuition fees.

We trust our comments are of assistance.

Yours truly,

Steve Tevlin
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Legislation Branch