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: 1) Is a Literacy Basic Skills program designed to upgrade English skills as part of a continuing education program of a school board qualify the student for the education credit pursuant to 118.6(2)?
Position: 1) NO
Reasons: 1) Educational Institution is not certified by the Minister of Human Resources Development to be an educational institution providing courses to furnish a person with skills for, or improve a person's skill in an occupation.
2) Basic English speaking skills are not generally considered an occupational skill
XXXXXXXXXX 991211
C. Tremblay
Attention: XXXXXXXXXX
Dear XXXXXXXXXX:
Re: Education Tax Credit
This is in reply to your letter of April 29, 1999, wherein you requested an opinion as to whether the XXXXXXXXXX meets the definition of a “designated educational institution" pursuant to subparagraph 118.6(1)(a)(ii) of the Income Tax Act (the “Act") as "certified by the Minister of Human Resources 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 skill in, an occupation".
You discuss a situation involving a specific student in your Literacy Basic Skills program and explain that this program helps students upgrade their English speaking skills to become more employable in the XXXXXXXXXX area.
Human Resources Development Canada is responsible for the certification of educational institutions for the purposes of subparagraphs 118.5(1)(a)(ii) or 118.6(1)(a)(ii) of the Act. Institutions wishing to establish whether they qualify as a designated educational institution should direct their enquiry to:
Certification of Private Educational Institutions
Human Resources Development Canada
Phase IV, 4th Floor,
Place du Portage
140 Promenade du Portage
Hull QC K1A 0J9
Interpretation Bulletin IT -515R2, Education Tax Credit (copy attached) provides the Department's views on the Education Tax Credit. Aside from the fact that a designated educational institution is one that is certified by the Minister of Human Resources Development, the education tax credit is only available where, among other criteria, the student is enrolled in that program to obtain skills for, or improve skills in, an occupation. The expression "enrolled in the program to obtain skills for an occupation" means that there must be sufficient skills to be acquired in the program to enable the student to work at an occupation. The expression "enrolled in the program to improve skills in an occupation" implies that the student already possesses sufficient skills to enable the student to work at an occupation and the program must be capable of improving those skills. It is a question of fact whether a particular program is capable of improving a student's occupational skills or is sufficient to furnish the student with enough skills to enable the student to work at an occupation. In our view, however, a student enrolled in a English speaking skills course would not qualify for the education tax credit because English is generally considered a lifeskill and does not necessarily improve the student's occupational skills.
Your enquiry focused on the education tax credit, however our views on the tuition tax credit may also be of interest to you. The tuition tax credit, is a non-refundable tax credit, and is generally determined by the amount of eligible tuition fees paid by the student for the year. If a claim relates to an educational institution certified by the Minister of Human Resources Development, as described in subparagraph 118.5(1)(a)(ii) of the Act, the purpose for the student's enrollment at the institution must be to furnish or improve a student's skills for an occupation. Similar to the test described above dealing with the education tax credit, in our view, "to obtain skills for an occupation" means that there must be sufficient skills to be acquired in the course to enable the student to work at an occupation. Paragraph 8 of IT-516R2, Tuition Tax Credit (copy attached) describes further the Department's views on the subject. Accordingly, an English speaking skills course, in our view, does not necessarily improve the student's occupational skills such that the student enrolled in such a course would not qualify for the tuition tax credit.
We trust our comments are of assistance to you.
Yours truly,
Jim Wilson
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 1999
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 1999
Email this Content