3 March 1999 External T.I. 9904405 - 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 university outside Canada, in respect of a distance education graduate 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). The individual is enrolled as part-time student and therefore does not meet the “full-time” requirement. In addition, 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 5-990440
M. Azzi
March 3, 1999

Dear Sir:

Re: Tuition Tax Credit

This is in response to your letter of February 17, 1999, regarding the tuition tax credit.

We understand that you are currently employed full-time, and are enrolled as a part-time student in a distance education graduate degree program at a university outside Canada. You feel that you should be allowed the tuition tax credit, in respect of the tuition fees paid for this distance education program, by reason of being enrolled on a part-time basis, and are requesting that the Income Tax Act (the “Act”) be changed to entitle you to this credit.

Our Comments

The determination of whether an individual qualifies for the tuition tax credit provided in section 118.5 of 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 appears that, in addition to not meeting the “full-time” requirement (by being a part-time student), you also do not meet the “attendance” requirement for claiming a tuition tax credit in respect of the tuition fees paid for the above-noted distance education program.

Please note that Revenue Canada does not write or amend legislation; the function of Revenue Canada is to administer and enforce the laws set out in the Act. The concerns raised in your letter relate to tax policy, which is the responsibility of the Department of Finance and, accordingly, they should have been addressed to that Department. We would note, however, in regards to your concerns with the tuition tax credit provided under paragraph 118.5(1)(c) of the Act to individuals living near the Canada-U.S. border and commuting to post-secondary educational institutions in the U.S., that, as explained in paragraph 13 of IT-516R2, tuition fees paid for correspondence courses would also not qualify for the credit under that paragraph.

If you wish to pursue the tax policy concerns further, or suggest changes to the Act, your enquiry should be directed to:

Department of Finance
Tax Policy Branch
L’Esplanade Laurier
140 O’Connor Street
Ottawa, Ontario
K1A 0G5

We trust that these comments will be of assistance.

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

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