17 February 1999 External T.I. 9832795 - TUITION - DISTANCE EDUCATION

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:

Whether an individual would be entitled to the tuition tax credit for tuition fees paid to a U.K. university, in respect of a distance education postgraduate degree program of the university.

Position TAKEN:

No.

Reasons FOR POSITION TAKEN:

The individual would not be in “full-time attendance at a university outside Canada” as required in paragraph 118.5(1)(b). As indicated in paragraph 11 of IT-516R2, where the courses are taken only by correspondence, the student is not considered to be in full-time attendance at the university.

XXXXXXXXXX 5-983279
M. Azzi
February 17, 1999

Dear Sir:

Re: Tuition Tax Credit

This is in response to your letter of November 25, 1998, which was forwarded to us for reply by our International Tax Directorate, regarding the tuition tax credit.

We understand that you currently have a full-time job, and would like to enrol in a distance education postgraduate degree program at a university in the U.K. You indicate that, according to the university concerned, it considers all distance education students to be taking a full course load with this degree program. You enquire whether you would be entitled the tuition tax credit in respect of tuition fees paid to the university for this distance education program. You also list six U.K. universities, and question whether these foreign universities are recognized for purposes of the tuition tax credit.

Our Comments

The determination of whether an individual qualifies for the tuition tax credit provided in section 118.5 of the Income Tax Act (the “Act”) requires a review of all the relevant facts of each particular situation. We have enclosed a copy of Interpretation Bulletin IT-516R2, Tuition Tax Credit, which explains the requirements which must be met in order to be entitled to this credit. Paragraph 9(a) of the bulletin provides a summary of the requirements which must be met with respect to tuition fees paid to a university outside Canada. While we were not provided with sufficient information, on the facts of your case, to comment on all these requirements, we would draw your attention to the requirement that the student be in full-time attendance at a university outside Canada. As indicated in paragraph 11 of IT-516R2, where the courses are taken only by correspondence, the student is not considered to be in full-time attendance at the university. Accordingly, based on the limited information provided, it would not appear that you would meet this requirement and, consequently, you would not be entitled to the tuition tax credit in respect of tuition fees paid for the above-noted distance education program.

As regards to the six U.K. universities listed in your letter, our International Tax Directorate advises us that they are recognized as universities outside Canada for purposes of the tuition tax credit. That is, tuition fees paid to these universities would qualify for the tuition tax credit, provided that all the other requirements (referred to above) are met for claiming tuition fees paid to a university outside Canada.

We were not provided with sufficient information to determine whether you would be entitled to the education tax credit in relation to the above-noted distance education program; however, we have enclosed a copy of Interpretation Bulletin IT-515R2, Education Tax Credit, to assist in establishing whether you would qualify for this credit. Should you require further assistance in establishing whether you qualify for this credit, you may contact officials of your local Tax Services Office.

We trust that these comments will be of assistance.

Yours truly,

Jim Wilson
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch

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