18 January 1999 GST/HST Ruling HQR0001374 - Application of the GST/HST to Tuition Fees

Dear Sir:

Thank you for your letter of October 8, 1998, (with attachments), concerning the application of the Goods and Services Tax (GST)/Harmonized Sales Tax (HST) to the transaction(s) described below.

Statement of Facts

Our understanding of the facts, the transaction(s), and the purpose of the transaction(s) is as follows:

1. The University XXXXX grants degrees at the bachelor's, master's and doctor's levels. It has been licensed by the XXXXX Board for Private Postsecondary Education to grant these degrees. A copy of this license was attached to the materials that you forwarded to us. The University of XXXXX is a for-profit institution.

2. The University of XXXXX has decided to expand its activities into Canada and for this purpose it has incorporated a subsidiary, the University XXXXX, a XXXXX[.]

3. The University of XXXXX has registered with the XXXXX[.] The registration certificate, dated XXXXX XXXXX, states that the XXXXX degrees that are earned in XXXXX XXXXX must be conferred in XXXXX[.] A copy of this certificate was attached to the materials that you sent to us.

4. The XXXXX will offer programs in Bachelor of Science in Business/Administration, Bachelor of Science in Business/Management, Bachelor of Science in Business/Information Systems, Master of Business Administration, and Master of Arts in Organizational Management. The degrees will be granted by the XXXXX.

5. The XXXXX may at a future date decide to offer courses of study leading to academic certificates in areas such as Human Resource Management, Call Center Management, and Project Management. These courses are created and approved using the same process as degree programs. The certificate programs are comprised of three to four university-level courses bundled together and taught using the same format and the same faculty as the degree programs.

Ruling Requested

The XXXXX qualifies as a university under section 123 of the Excise Tax Act ("ETA").

The tuition fees charged by the XXXXX for degree courses will be exempt of GST/HST under section 7 of Part III of Schedule V to the ETA.

The tuition fees charged by the XXXXX for certificate programs will be exempt of GST/HST under section 16 of Part III of Schedule V to the ETA.

Ruling Given

Based on the facts set out above, we rule that the XXXXX University XXXXX qualifies as a university for purposes of the ETA since the organization meets the criteria outlined in Policy Statement P-214 - Foreign-Based Entities which Qualify as a "University" in the Excise Tax Act.

The tuition fees charged by the University XXXXX will be exempt of GST/HST under section 7 of Part III of Schedule V to the ETA. Further, tuition fees for certificate programs will be exempt of GST/HST under section 16 of Part III of Schedule V to the ETA.

This ruling is subject to the general limitations and qualifications outlined in section 1.4 of Chapter 1 of the GST/HST Memoranda Series. We are bound by this ruling provided that none of the above issues is currently under audit, objection, or appeal; that there are no relevant changes in the future to the Excise Tax Act, or to departmental interpretative policy; and that you have fully described all necessary facts and transaction(s) for which you requested a ruling.

Should you have any further questions or require clarification on the above matter, please do not hesitate to contact me at (613) 954-7957.

Yours truly,

Paule Labbé
A/Manager, Educational Services and Indians Unit
Public Service Bodies and Governments Division
GST/HST Rulings and Interpretations Directorate

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