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 Department. Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
PRINCIPAL ISSUES:
XXXXXXXXXX
The issues concern whether a Program student qualifies for the tuition tax credit (section 118.5 of the Income Tax Act (the Act)) and/or the education tax credit (section 118.6 of the Act) (i) where the student does not physically attend the University with respect to courses, and (ii) where the student physically attends the University for the XXXXXXXXXX week period of time .
POSITION:
A student is not entitled to tuition tax credit or the education tax credit in respect of (i) or (ii).
REASONS:
(i) The student is not considered to satisfy the "full-time attendance" requirement in paragraph 118.5(1)(b) of the Act in view of the limited interaction between the University and the student, and the nature of the program itself. In the case of the educational tax credit, the student is not considered to satisfy the requirement set out in the definition of "qualifying educational program" concerning the XXXXXXXXXX as there is no work or instruction scheduled within the program.
(ii) The student is not considered to satisfy the 13 week requirement set out in paragraph 118.5(1)(b) of the Act. Similarly, the student is not considered to satisfy the 13 week requirement in the definition of "designated institution".
960221 XXXXXXXXXX M. Eisner
July 11, 1996
Dear Sir:
Re: Tuition Fees
This is in reply to your letter of November 10, 1995 concerning the tuition tax credit and the education tax credit. We also acknowledge our telephone conversation (Eisner/XXXXXXXXXX) in which we obtained additional information.
In your letter you have indicated that
XXXXXXXXXX
Our Comments
The Department's general position on the tuition tax credit and the education tax credit are respectively set out in Interpretation Bulletins IT-515R "Tuition Tax Credit" and IT-516R "Education Tax Credit" which have been enclosed.
The determination of a student's entitlement to the tuition tax credit or the education tax credit in respect of a course offered by a university is affected by the location of that university, i.e., inside or outside Canada. In this case, the University is located outside Canada.
In our comments below, we have set out all the requirements that must be satisfied in respect of the tuition tax credit as well as the education tax credit. However, as our response is unfortunately not favourable, we have limited our discussion to some of the more key requirements.
Where tuition fees are paid to a university outside Canada, certain fees are excluded from qualifying for the tuition tax credit (see paragraph 8(a) of IT-516R). Apart from the sponsorship exclusions, the student must be in full-time attendance at a university, in a course which leads to a degree and is at least 13 consecutive weeks in duration in order to be eligible to claim the credit in respect of tuition fees paid to the university.
If a Program student attends the University where two courses will be taught on a full-time basis, it is our view that the "13 week" requirement would not be satisfied as the courses are only for a period of XXXXXXXXXX weeks.
With respect to the "full-time attendance" requirement, it is our understanding that the University also offers a Masters of Business Administration program for students who physically attend the university on a full-time basis. The courses are taught to the students during XXXXXXXXXX and the content and course material of these courses is the same as that offered to Program students. In relation to the Masters of Administration program taught at the University, the fact that interaction between the University and the Program students is limited, and the nature of the Program itself, it is our view that Program students do not satisfy the "full-time" requirement.
As a consequence of the foregoing comments, it is our view that students would not be entitled to claim the tuition tax credit for tuition fees paid in respect of the Program.
In order for a student to claim the education tax credit for a particular month, the student must be enrolled in a "qualifying educational program" as a full-time student at a "designated educational institution". However, certain disabled students (see paragraph 2 of IT-515R) need only be part-time students. Comments on the terms "qualifying educational program" and "designated educational program" are set out below:
(a) A university outside Canada is considered to be a "designated educational institution" if the student was enrolled in a course of at least 13 consecutive weeks duration, leading to a degree.
(b) As indicated in paragraph 17 of IT-515R (subject to the comments in paragraph 18 thereof) and paragraph 20 of IT-515R, certain programs are excluded from being a "qualifying education program". In addition, one of the requirements within the definition of "qualifying education program" is that the program must run for at least three consecutive weeks and must require instruction or work in the program of at least ten hours a week throughout its duration. A further requirement is that the program be at a post- secondary level.
In the case of students who physically attend the University for the XXXXXXXXXX week period of time, it is our view, consistent with our comments made in respect of the tuition tax credit, that they would not satisfy the "13 week" requirement.
In the case of other courses in respect of the Program, it is our view that the requirement in (b) concerning work and instruction of XXXXXXXXXX contemplates the type of situation where the educational institution schedules work and instruction which may or may not result in the requirement being satisfied. If the requirement is considered to have been satisfied by the educational institution and a student is otherwise considered to qualify for the education tax credit, a certificate, which a student is required to file for income tax purposes, should be issued which documents the student's entitlement to the credit. In the case of the Program, there is no scheduled work or instruction. Rather, the Program is designed so that students can study course material at their own pace when they have the available time to do so. It is, accordingly, our view that Program students would not satisfy this requirement.
As a result of the above comments, it is our view that a student who is taking courses in respect of the Program would not qualify for the education tax credit.
We regret that we could not provide you with a more favourable reply.
Yours truly,
J.A. Szeszycki For Director Business and Publications Division Income Tax Rulings and Interpretations Directorate Policy and Legislation Branch
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