2003 Ruling 2003-0042283 - TUITION OTHER 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 CCRA.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ADRC.

Principal Issues:

Can a taxpayer claim the tuition tax credit for an AQ courses taken from the Board of Education.

Position: Yes.

Reasons:

The Board of Education qualifies as "other educational institution" -

The AQ course is at the post secondary school level.

Students can claim the tuition tax credit.

XXXXXXXXXX 						2003-004228

XXXXXXXXXX, 2003

Dear XXXXXXXXXX:

Re: Advance Income Tax Ruling
XXXXXXXXXX (the "Board")

This is in reply to your letters of XXXXXXXXXX, wherein you request an advance income tax ruling on behalf of the above named organization.

To the best of your knowledge and that of the Board, none of the issues involved in this request for an advance income tax ruling:

(a) is before the courts; or

(b) is the subject of a ruling previously issued by the Income Tax Rulings Directorate to the Board or to a person related to the Board.

Unless otherwise stated, all references to a statute are to the Income Tax Act (Canada), R.S.C. 1985, c.1 (5th Supp.), as amended to the date of this letter, (the "Act"), and all terms and conditions used herein that are defined in the Act have the meaning given in such definition unless otherwise indicated.

Our understanding of the facts, the proposed transaction and the purpose of the proposed transaction is as follows:

FACTS

1. The XXXXXXXXXX (the "College") has a mandate under the XXXXXXXXXX to provide for the on-going professional learning of its members.

2. A teacher who successfully completes a course, which has been granted accreditation by the Registrar of the College (an "AQ Course"), is entitled to have an additional qualification recorded on his or her Certificate of Qualifications pursuant to XXXXXXXXXX.

3. In order to be granted accreditation an AQ Course must meet the following criteria:

(i) consist of a minimum of 125 hours of work that is approved by the Registrar;

(ii) the program content and expected achievement of persons enrolled in the program, match the skills and knowledge reflected in the College's Standard of Practice for the Teaching Profession and the Ethical Standards for the Teaching Profession;

(iii) satisfy the requirements of the Regulation for entry of an additional qualification on the certificate of qualification of a person who successfully completes the program;

(iv) the program curriculum is current, references the XXXXXXXXXX curriculum, relevant legislation and government policies and represents a wide knowledge base in the program's area of concentration;

(v) the course content of the program makes appropriate provision for the application of theory in practice;

(vi) the program's format and structure are appropriate for the course content of the program;

(vii) there is clear identification of the goals of the program, with formal testing or assessment mechanism to determine the level of successful completion of the program;

(viii) the majority of the educators teaching the program have relevant XXXXXXXXXX teaching experience;

(ix) the provider maintains adequate internal controls to preserve the integrity of student records; and

(x) the provider is committed to continuous improvement and quality assurance of the program and, if the program is an existing program, has implemented measures demonstrating that commitment.

4. The Board has been accredited by the College pursuant to the XXXXXXXXXX as a provider of an AQ Course and is seeking approval to provide other such courses. The course presently offered is called "XXXXXXXXXX". The course description states that this particular AQ Course in XXXXXXXXXX.

5. Universities and professional associations also provide AQ Courses.

6. In order to enrol in an AQ course the student must provide proof that he or she is a qualified teacher in good standing in XXXXXXXXXX. In order to become a qualified teacher, an individual must complete a prescribed program of education at the post-secondary level.

7. The Board has applied to Human Resources and Development Canada ("HRDC") for certification pursuant to subparagraphs 118.5(l)(a)(ii) and 118.6 (l)(ii) of the Act. HRDC personnel have verbally advised the Board that such application will not be granted because the Board is not a private business.

8. The Board began offering an AQ Course in the XXXXXXXXXX Academic Year. It has not issued receipts containing the information set out in Interpretation Bulletin IT-516R2 with respect to any fees paid to it to date.

9. The Board has no knowledge as to whether any of the participants in the course made a claim for a tuition tax credit on his or her personal tax return for the XXXXXXXXXX taxation year. Further, the Board does not have any knowledge of any outstanding objection with respect to this matter.

PROPOSED TRANSACTION:

10. The Board proposes to issue tax receipts in respect of the AQ course described in paragraph 4 above.

PURPOSE OF PROPOSED TRANSACTION:

11. The Board wants to ensure that individuals who pay tuition fees for an AQ course taken from the Board can claim a tuition tax credit pursuant to subparagraph 118.5(1)(a)(i) of the Act.

RULING GIVEN

Provided that the preceding statements constitute a complete and accurate disclosure of all relevant facts, proposed transaction and purpose of the proposed transaction, and provided the transactions are completed as proposed, we rule as follows:

A. The Board qualifies as an "other educational institution" for the purposes of subparagraph 118.5(1)(a)(i) of the Act.

B. The "XXXXXXXXXX" AQ Course as described in paragraph 4 above is a course at the post-secondary school level as that term is used in subparagraph 118.5(1)(a)(ii.1) of the Act.

C. For the purposes of computing tax payable under Part I of the Act by an individual for a taxation year, an individual may deduct, where the individual was during the year a student enrolled in an AQ Course as described in paragraph 3 above, given by the Board, an amount equal to the product obtained where the appropriate percentage for the year is multiplied by the amount of any fees for the individual's tuition paid in respect of the year to the Board, if the total of those fees exceeds $100 and provided that none of the exceptions contained in subparagraphs 118.5(l)(a)(iii), (iii.1), (iv) or (v) are applicable.

These rulings are given subject to the general limitations and qualifications set forth in Information Circular 70-6R5 dated May 17, 2002 issued by the Canada Customs and Revenue Agency (the "CCRA"), and are binding provided the Board issues the tax receipts in acceptable form to students enrolled in the AQ course offered by the Board in the XXXXXXXXXX taxation year by XXXXXXXXXX.

COMMENTS

We wish to confirm that nothing in the above rulings should be construed as implying that CCRA has agreed to or reviewed the determination of whether:

(a) the Board is a "designated educational institution", as defined in subsection 118.6(1) of the Act, for purposes of the education tax credit in subsection 118.6(2) of the Act; and

(b) an individual enrolled in AQ courses offered by the Board may deduct the education tax credit pursuant to subsection 118.6(2) of the Act for a taxation year.

Yours truly,

XXXXXXXXXX
For Director
Financial Industries Division
Income Tax Rulings Directorate
Policy and Legislation Branch