Principal Issues: Whether financial assistance to be paid by a company to individuals to attend university in Canada is taxable under paragraph 56(1)(n) of the Act when the company may offer the individual employment at the end of the study period, and should the individual refuse employment, the financial assistance would have to be repaid to the company?
Position: Unable to provide an advance income tax ruling.
Reasons: Paragraph 56(1)(n) of the Act does not apply to "amounts received in respect of, in the course of or by virtue of an office or employment". The determination of whether an employee-employer relationship is in existence is primarily a question of fact on which we cannot rule. Further, the request also asked that we rule that the Federal Budget proposal to exempt certain scholarships, fellowships or bursaries from income would apply. We are unable to rule on provisions of the Act that have not yet been enacted.
