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.
Principal Issues: "Post-doctoral fellows - education tax credit
Position: Question of Fact.
Reasons: Eligibility for the education tax credit is to be determined on a case-by-case basis. An individual must satisfy all of the conditions of section 118.6
2007-024280
XXXXXXXXXX L. Zannese
(613) 957-2747
August 17, 2007
Dear XXXXXXXXXX:
Re: Issuing T2202 to Post-Doctoral Fellows
This is in response to your letter of June 28, 2007 inquiring as to whether educational institutions in Canada may issue T2202 forms to individuals who are post-doctoral fellows.
The situation outlined in your letter appears to relate to a factual one, involving a specific group of taxpayers. It is not this Directorate's practice to comment on proposed transactions involving specific taxpayers other than in the form of an advanced income tax ruling. For more information about how to obtain a ruling, please refer to Information Circular 70-6R5, "Advanced Income Tax Rulings", dated May 17, 2002. This Information Circular and other CRA publications can be accessed on the Internet at http://www.cra-arc.gc.ca. Should your situation involve a specific taxpayer and a completed transaction, you should submit all relevant facts and documentation to the appropriate Tax Services Office ("TSO") for their views. A list of TSOs is available on the "Contact Us" page of the CRA website. Although we cannot comment on your specific situation, we are prepared to provide the following general comments, which may be of assistance.
The CRA's general view regarding the Education Tax Credit is contained in Interpretation Bulletin IT-515R2 "Education Tax Credit". For information with respect to scholarships, fellowships and bursaries, see IT-75R4 "Scholarships, Fellowships, Bursaries, Prizes and Research Grants". These Interpretation Bulletins and other CRA publications are also available on the CRA web site at http://www.cra-arc.gc.ca.
Starting in 2006, paragraph 56(3)(a) of the Act applies to fully exempt income received as a "scholarship, fellowship or bursary" (as those terms are used for purposes of the Act), where the income is connected to the individual's enrolment in an educational program that is eligible for the education tax credit described in subsection 118.6(2) of the Act (the "ETC"). The ETC is available where an individual is enrolled at a "designated educational institution", in a "qualifying educational program" or a "specified educational program", as those terms are defined in subsection 118.6(1) of the Act.
A "designated educational institution" is defined in subsection 118.6(1) to include those educational institutions in Canada that are either:
(i) a university, college, or other educational institution designated by the Lieutenant Governor in Council of a province as a specified educational institution under the Canada Student Loans Act, designated by an appropriate authority under the Canada Student Financial Assistance Act, or designated by the Minister of Higher Education and Science of the Province of Quebec for the purposes of An Act respecting financial assistance for students of the Province of Quebec, or
(ii) certified by the Minister of Human Resources and Skills Development to be an educational institution providing courses, other than courses designed for university credit, that furnish a person with skills for, or improve a person's skills in, an occupation.
A "designated educational institution" may issue a T2202 or T2202A to a full-time student enrolled in a "qualifying education program" or to a part-time student enrolled in a "specified educational program". The term "qualifying educational program" requires, in part, that the program run for at least 3 consecutive weeks and must provide that each student taking the program spend at least 10 hours per week on courses or work in the program. If the student receives any benefit in respect of the program from a person with whom the student was dealing at arm's length (other than certain forms of financial assistance) the program is not a qualifying educational program.
The term "enrolled...as a full-time student" is not defined in the Act. However, paragraphs 5 to 7 of the IT-515R2 provide general comments regarding the CRA's interpretation of this term. As indicated in paragraph 5 of IT-515R2, the requirement for enrolment as a full-time student at a designated educational institution must ultimately be met on the basis of the facts of each case. The CRA generally relies on the institution's determination as to whether the individual is registered as a full-time student.
Where the individual is enrolled at a designated educational institution but does not qualify as a full-time student, the individual may still qualify for the part-time ETC. To qualify, the individual must be enrolled in a specified educational program that provides that each student in the program spend not less than 12 hours in the month on courses in the program. A "specified educational program" means a program that would be a "qualifying educational program" if that term were read without reference to the "10 hours per week test".
If the institution offering the program satisfies itself that it meets the definition of a "designated educational institution" and that the student is enrolled in a program that meets the above noted criteria for either a "qualifying educational program" or a "specified educational program" then the institution may issue a T2202 to the student. However, the receipt of a T2202 from an institution does not guarantee that an individual will qualify for the ETC. Eligibility for the ETC is determined on a case-by-case basis. An individual must satisfy all the conditions of subsection 118.6(2) in order to qualify. The CRA can only determine whether an individual has met these requirements after the individual's specific fact situation is reviewed.
We trust that these comments will be of assistance.
Yours truly,
Robin Maley
Manager
Non-Profit Organizations and
Aboriginal Issues
Financial Sector and Exempt Entities Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch
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