REASONS
FOR JUDGMENT
Boyle J.
[1]
This informal appeal requires the Court to
decide if Ms. Archibald was attending university full‑time while she
was enrolled and completing her master’s degree in business administration from
the University of Liverpool in its online learning program. Full‑time
attendance is a requirement in order to claim the education tax credit if the
university one attends is outside Canada.
[2]
This appeal is in respect of the 2014 taxation
year which was Ms. Archibald’s first year of MBA studies. Her courses were
offered in the last seven months of that year. She has now completed her MBA
and her graduation will be this July. She has been working full‑time at
Humber College in Toronto throughout, and has obtained her MBA to pursue a
career as a full‑time instructor at Humber College.
[3]
Ms. Archibald has previously completed her
bachelor’s degree in education and her master’s degree in education from well‑known
and reputable Canadian universities, both on a distance learning basis. One of
those Canadian universities offers both on‑campus and distance learning
programs; the other only offers distance learning programs.
[4]
The University of Liverpool is a well‑known
and reputable university in the United Kingdom. It offers the MBA program from
which Ms. Archibald has recently graduated on both on‑campus and
online learning bases. The University of Liverpool describes its distance
learning as an online program.
[5]
The University issued to Ms. Archibald a
Canada Revenue Agency (“CRA”) TL11A information slip which clearly indicated
that all of her study months in the year were part‑time and none were
full‑time.
[6]
Ms. Archibald explained that the University
had classified online learning in its MBA program as part‑time because
its MBA program is a one‑year program for students attending its campus,
whereas the courses are offered over a three‑year period for those attending
online.
[7]
Ms. Archibald also put in evidence her
email exchange with the University officer in the Bursar’s Office which
explains the part‑time classification on her TL11A slip. It confirms
Ms. Archibald’s explanation and reads:
Regarding the
full time/part time classification, the degree conferring institution makes
this determination. This is due to the rates that credits are accumulated. Full
time masters degrees are completed in one academic year in the United Kingdom
(including dissertation), and online programmes are completed at three years on
average. It is not possible for students to study fast enough to be considered to
be studying full time. . . .
[8]
The MBA program requires successful completion
of 180 credits to graduate, whether attending online or on campus. All 180
credits are completed in a single academic year if attending on campus. The
credits for courses offered online in each year are 30 credits in year one and
75 credits in each of years two and three.
[9]
The University MBA program is offered in eight
course modules. All but one are eight‑week modules. Each eight‑week
module is worth 15 credits. The University’s materials indicate:
The amount of
learning indicated by a credit value is based on an estimate using the idea of notional
hours of learning. The number of notional hours of learning provides a
rough guide to how long it will take a typical student, on average, to achieve
the learning outcomes (what you will know, understand and be able to do having
successfully completed the learning) specified for the module or programme.
The estimate of
notional hours of learning doesn’t just include formal classes, but estimates
the amount of time spent in preparation for these classes, along with private
or independent reading and study, plus revision and the completion of
course-work required on the module.
Within the UK, one
credit represents 10 notional hours of learning. Institutions use this
guide as a basis for setting the credit value of a module or programme before
it is offered to students. For example, a module that is estimated to involve
150 notional hours of learning will be assigned 15 credits and one that
involves 400 notional hours of learning will be assigned 40 credits.
If it takes you
more or less time than estimated to complete the learning, you are still
awarded the set credit value — not more or less.
. . .
[10]
Thus, an eight‑week 15 credit module is
estimated to involve 150 notional hours of learning — or somewhat less than 20
hours per week.
[11]
In her testimony, Ms. Archibald estimated that
she worked 25 to 40 hours each week on her MBA courses. In her letter to
the CRA refuting the assessment, she estimated she spent 20 to 25 hours weekly
and, later, 25 to 30 hours weekly. In her email to the University Bursar’s Office,
she estimated she spent approximately 30 hours per week.
[12]
It is not disputed that a student can attend a
university full‑time when enrolled in distance or online learning. It is
not disputed that a student can both work full‑time and pursue her studies
full‑time. It is not disputed that postgraduate studies can be pursued
full‑time even though there may not be scheduled hours for classes,
lectures, labs or discussions groups, etc. commonly associated with
undergraduate studies. At the hearing, the Crown acknowledged that, contrary to
what was assumed by the CRA when reassessing Ms. Archibald, she did not in
fact receive any financial assistance from Humber College for her studies. The
only issue to be decided is whether the University’s classification of her
studies as part‑time is correct or whether her estimate of, say,
approximately 30 hours per week, qualifies her attendance as full‑time.
[13]
It is my view that the University’s part‑time
classification is correct. The University’s characterization is well‑reasoned
and sensible in the circumstances. It is objectively determined, beginning with
the U.K. definition of a university credit as involving 10 notional hours
of learning. Finally, it compares its on‑campus MBA program rate of
accruing credits to the rate of credit accumulation for its online MBA program
involving the same courses, modules, credits and other requirements. Since the
online rate is 30% to 40% of the on‑campus rate of credit accumulation
for completed studies, it is reasonable to conclude that it cannot be described
as full‑time attendance.
[14]
I do not accept that the legislation
contemplates that full‑time or part‑time characterization of a
student’s attendance at a university is dependent upon how much time each
particular individual needs to, or chooses to, devote to their studies. Such an
approach would lead to universities being unable to make the determinations
needed to issue the required information slips. It would require this Court to
decide how much less than 100% full‑time is still full‑time and to
draw a full‑time/part‑time cut‑off line. Importantly, it
would not be realistic to expect a court following such an approach to simply
accept a particular student’s very rough and otherwise unsubstantiated estimate
of her average weekly hours devoted to program studies. Different people learn
differently and at different speeds. There is nothing wrong with that and it is
very easy to observe. However, there is no reason to think that the
classification of a student’s attendance at university on either a full‑time
or part‑time basis for purposes of the education tax credit should differ
because of that.
[15]
My conclusion is consistent with what Justice
Paris wrote in Ferre v. The Queen, 2010 TCC 593:
26 It seems to
me that the question of whether an individual is enrolled as a full‑time
student and is in full-time attendance is a matter that is determined by the
institution the individual is attending. The institution controls its
enrollment and determines the status of its students as either full or
part-time according to the course load that is undertaken. Here, the University
certified on the TL11A form that the Appellant was registered for part-time
credit during 2008, and the Appellant has not shown that this information is
incorrect. I place no weight on his testimony that an unnamed person at the
University told him that his courses were treated as part-time courses by the
University only because they were taken online. This is hearsay, and
furthermore it was not established what position the unnamed person occupied at
the University or how he or she would have knowledge of why the Appellant’s
courses were treated as part-time. Also, the written materials from the
University show that the course work was expected to take between 20 and 25
hours per week, which is consistent with part-time status.
27 The meaning of the phrase “full-time attendance” in paragraph
118.5(1)(b) and previous versions of that provision has been the subject
of several Court decisions. In R. v. Gaudet, the Federal Court of Appeal
said that the phrase “full-time” was “a difficult expression and one which it
may be impossible to define exactly.” However, the Court went on to find that
the taxpayer’s wife, who had taken a night course which involved seven hours of
classes and 10 hours of study per week was not a student in full-time
attendance for the purpose of what was then paragraph 110(1)(h) of the
Act.
. . .
30 While I
agree with the Tax Review Board that it may be possible for a person to carry
on more than one full-time activity at a time, I do not think that the question
of whether a student is in full-time attendance at a university can be answered
simply by looking at the time spent by a taxpayer on courses or other related
activities. If so, a person who took only one course but spent the equivalent
of a full work week on course work could be said to be in full-time attendance,
while a person who took a full course load but only spent a few hours a day on
them would not be. I do not believe that this is the intent of the tuition and
education credit provisions of the Act since it would make it extremely
difficult to administer. It is necessary in my view to look at objective
criteria in determining full-time attendance. The best indicator would be the
university’s expectation of the student and the amount of time the program is
designed to take. The evidence in this case shows that the University expected
the online MBA program to take between 20 and 25 hours per week to complete. It
is not clear whether this was applicable to the Appellant’s work on his
dissertation, but the fact that that the TL11A form showed that he was
registered for part-time credit in 2008 would suggest that the time
requirements of the dissertation was similar to what was required for his course
work. Therefore, I find that the Appellant was not in full-time attendance and
was not enrolled as a full-time student at the University in 2008, and is not
eligible for the tuition or full-time education credit.
(The Ferre decision also involved the
University of Liverpool’s online MBA program.)
[16]
Ms. Archibald referred the Court to Krause
v. The Queen, 2004 TCC 594, as support for the position that spending between
22 to 36 hours weekly constitutes full‑time attendance. However, it is
clear that in Krause, the university characterized the attendance as
full‑time and that the key issue before Associate Chief Justice Bowman
(as he then was) was whether online attendance could ever be considered full‑time.
[17]
Ms. Archibald also referred the Court to McGrath
v. The Queen, 2007 TCC 295, as another case in which 20 to 25 hours weekly
qualified as full‑time attendance. In McGrath, the evidence
accepted by Justice McArthur was that the university considered Ms. McGrath
to be in full‑time attendance. That is not the case here.
[18]
Finally, Ms. Archibald referred the Court
to the decision of Justice Bowie in Siddell v. The Queen, 2011 TCC 250,
which again involved the University of Liverpool’s online MBA program. However,
in that case, the Crown did not dispute that Mr. Siddell was a full‑time
student. The issue before the Court was only whether the since repealed 13‑week
course requirement for the education tax credit was satisfied.
[19]
In none of these cases did the Court decide
contrary to the particular university’s classification, nor did any decide that
20 to 30 hours weekly constituted full‑time.
[20]
I do not need to decide in this case how the
full‑time/part‑time classification should be made for a student
attending a university that only offers online courses or distance education,
which may include on‑campus requirements, and does not offer completely
on‑campus courses. I could not decide what would be reasonable in such a
case as I have no evidence of how such a university makes such
characterizations, nor how it assigns credits to its courses, nor how often it
offers the particular courses required to complete a particular program, etc.
This is best left to another case that involves such a university where the
needed evidence would be before the Court.
[21]
I am dismissing Ms. Archibald’s appeal
because her facts and circumstances do not satisfy the requirements set out in
the Income Tax Act for the education tax credit.
[22]
Ms. Archibald is to be commended for the
clarity of her presentation and for the preparation that obviously went into
it. She performed in the top of the top 1% of self‑represented taxpayers
appearing before this Court based on my 10‑year judicial experience. She
outshone some lawyers and many other agents and representatives who have
appeared before me. Her preparation and composure, the clarity of her written
materials, her oral evidence and her submissions, and her ability to respond to
questions in cross‑examination, are no doubt a reflection of what a fine
educator she must be.
[23]
The appeal is dismissed without costs.
Signed at Ottawa, Canada, this 30th day of May 2017.
“Patrick Boyle”
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