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: Taxable status of the reimbursement by the employer for the cost of a parachuting course taken by the employee to upgrade his qualifications for employment purposes.
Position: Non-taxable.
Reasons: Course is taken for maintenance or upgrading of employer-related skills
Randy Hewlett, B.Comm.
XXXXXXXXXX 613-957-8973
2003-004163
November 5, 2003
Dear XXXXXXXXXX:
Re: Employer-Paid Education Costs
We are writing in response to your letter of September 26, 2003, wherein you requested our opinion on the taxable status of a reimbursement to you by the Canadian Armed Forces (the "CAF") for the cost of a parachuting course.
In your letter, you indicated that you are a serving member of the CAF who is a qualified military parachutist. You completed the course to upgrade your skills and to become eligible to apply for the CAF Parachuting Team. You inquired whether the reimbursement results in a taxable employment benefit.
The CCRA's position with respect to taxable benefits for employer-paid educational costs is discussed in Interpretation Bulletin IT-470R (Consolidated), Employees' Fringe Benefits. As noted in paragraph 18, an employer's payment or reimbursement of the cost of a "specific employer-related training" course does not result in a taxable benefit to the employee. "Specific employer-related training" courses are those that are taken for the maintenance or upgrading of employer-related skills, when it is reasonable to assume that the employee will resume his or her employment for a reasonable period of time after completion of the course.
In our view, since the parachute course described in your letter is a specific employer-related training course, the reimbursement to you by the CAF for its cost is not a taxable benefit.
We trust our comments will be of assistance to you.
Yours truly,
John Oulton, CA
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Legislation Branch
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