Students studying outside of Canada get a tax break

The rules have changed for students studying outside of their home country. Under the old rules, if you studied at a university or college outside of Canada you could only claim tuition fees for courses that lasted at least 13 consecutive weeks and lead to a degree. This also applied if you wanted to claim the education and textbook amounts.

The 13-week requirement has been challenged in the past. In 2010, Ferre v The Queen 2010 TCC 593 saw a taxpayer argue that his online MBA program through the University of Liverpool qualified since he took four courses that were six weeks each. The court disagreed, finding the 13-week requirement applied to the individual courses, rather than the entire program.

Considering an online MBA is a degree and the program lasted 24 weeks in total, this does not seem reasonable. And a 2011 tax court ruling seemed to agree. In Siddell v The Queen 2011 TCC 250, a judge disputed the reasoning in Ferre and allowed another taxpayer enrolled in the same online course to appeal the decision.

Now the rule has been changed to three weeks starting on the 2011 tax return. So if you are studying outside of Canada, you may be able to claim some or all of the student tax credits, depending on your program, as long as the program lasted three weeks. The same rules apply whether or not you can claim tuition as well as the education and textbook amounts. In order to qualify for the education and textbook amounts, your courses need to lead to a degree. So, if you decide to go to a university in Italy to take a month-long course as part of your summer vacation, you will still not qualify.

In order to claim your credits, your university or college must complete a TL11A Form Tuition, Education, and Textbook Amounts Certificate – University Outside Canada. The form is included in the student’s tax return, so the school does not send it to the Canada Revenue Agency. The school cannot use its own country’s tax forms instead of the TL11A. The Canada Revenue Agency (CRA) will not accept it.

Remember, the TL11A Form is for the calendar year. So, if you started your program in September 2011 then the amount shown should only be for the first semester of your studies.

And if you have tried to claim tuition or other student credits for a program abroad and been unsuccessful, you may want to watch the appeal in the Siddell v The Queen case. If the taxpayer is successful, it may open the door to appeal pre-2011 re-assessments of other courses or programs.

Brenda Bryant
Senior tax pro and community supporter