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Income Tax Act (R.S.C., 1985, c. 1 (5th Supp.))

Full Document:  

Act current to 2022-05-02 and last amended on 2021-12-17. Previous Versions

PART IIncome Tax (continued)

DIVISION EComputation of Tax (continued)

SUBDIVISION ARules Applicable to Individuals (continued)

Marginal note:Definitions

  •  (1) For the purposes of sections 63 and 64 and this Subdivision,

    designated educational institution

    designated educational institution means

    • (a) an educational institution in Canada that is

      • (i) a university, college or other educational institution designated by the lieutenant governor in council of a province as a specified educational institution under the Canada Student Loans Act, designated by an appropriate authority under the Canada Student Financial Assistance Act, or designated, for the purposes of An Act respecting financial assistance for education expenses, R.S.Q, c. A-13.3, by the Minister of the Province of Quebec responsible for the administration of that Act, or

      • (ii) certified by the Minister of Employment and Social 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 skills in, an occupation,

    • (b) a university outside Canada at which the individual referred to in the definition qualifying student in this subsection was enrolled in a course, of not less than three consecutive weeks duration, leading to a degree, or

    • (c) if the individual referred to in the definition qualifying student in this subsection resided, throughout the  year referred to in that definition, in Canada near the boundary between Canada and the United States, an educational institution in the United States to which the individual commuted that is a university, college or other educational institution providing courses at a post-secondary school level; (établissement d’enseignement agréé)

    qualifying educational program

    qualifying educational program means a program of not less than three consecutive weeks duration that provides that each student taking the program spend not less than 10 hours per week on courses or work in the program and, in respect of a program at an institution described in the definition designated educational institution (other than an institution described in subparagraph (a)(ii) of that definition), that is a program that does not consist primarily of research (unless the program leads to a diploma from a college or a Collège d’enseignement général et professionnel, or a bachelor, masters, doctoral or equivalent degree) but, in relation to any particular student, does not include a program if the student receives, from a person with whom the student is dealing at arm’s length, any allowance, benefit, grant or reimbursement for expenses in respect of the program other than

    • (a) an amount received by the student as or on account of a scholarship, fellowship or bursary, or a prize for achievement in a field of endeavour ordinarily carried on by the student,

    • (b) a benefit, if any, received by the student because of a loan made to the student in accordance with the requirements of the Canada Student Loans Act, the Apprentice Loans Act or An Act respecting financial assistance for education expenses, R.S.Q., c. A-13.3, or because of financial assistance given to the student in accordance with the requirements of the Canada Student Financial Assistance Act, or

    • (c) an amount that is received by the student in the year under a program referred to in subparagraph 56(1)(r)(ii) or (iii), a program established under the authority of the Department of Employment and Social Development Act or a prescribed program; (programme de formation admissible)

    qualifying student

    qualifying student, for a month in a taxation year, means an individual who,

    • (a) in the month,

      • (i) is enrolled in a qualifying educational program as a full-time student at a designated educational institution, or

      • (ii) is not described in subparagraph (i) and is enrolled at a designated educational institution in a specified educational program that provides that each student in the program spend not less than 12 hours in the month on courses in the program,

    • (b) if requested by the Minister, proves the enrolment by filing with the Minister a certificate in prescribed form issued by the designated educational institution and containing prescribed information,

    • (c) in the case of an individual who is enrolled in a program (other than a program at the post-secondary school level) at a designated educational institution described in subparagraph (a)(i) of the definition designated educational institution or who is enrolled in a program at a designated educational institution described in subparagraph (a)(ii) of that definition,

      • (i) has attained the age of 16 years before the end of the year, and

      • (ii) is enrolled in the program to obtain skills for, or improve the individual’s skills in, an occupation, and

    • (d) in the case of an individual who is enrolled at a designated educational institution described in paragraph (c) of the definition designated educational institution, is enrolled in a program that is at the post-secondary level; (étudiant admissible)

    specified educational program

    specified educational program means a program that would be a qualifying educational program if the definition qualifying educational program were read without reference to the words “that provides that each student taking the program spend not less than 10 hours per week on courses or work in the program”. (programme de formation déterminé)

  • (2) and (2.1) [Repealed, 2016, c. 7, s. 16]

  • Marginal note:Students eligible for disability tax credit

    (3) For the purposes of subparagraph (a)(i) of the definition qualifying student in subsection (1), the reference to “full-time student” is to be read as “student” if

    • (a) an amount may be deducted under section 118.3 in respect of the individual for the year; or

    • (b) the individual has in the year a mental or physical impairment the effects of which on the individual have been certified in writing, to be such that the individual cannot reasonably be expected to be enrolled as a full-time student while so impaired, by a medical doctor, a nurse practitioner or, where the impairment is

      • (i) an impairment of sight, by a medical doctor, a nurse practitioner or an optometrist,

      • (i.1) a speech impairment, by a medical doctor, a nurse practitioner or a speech-language pathologist,

      • (ii) a hearing impairment, by a medical doctor, a nurse practitioner or an audiologist,

      • (iii) an impairment with respect to the individual’s ability in feeding or dressing themself, by a medical doctor, a nurse practitioner or an occupational therapist,

      • (iii.1) an impairment with respect to the individual’s ability in walking, by a medical doctor, a nurse practitioner, an occupational therapist or a physiotherapist, or

      • (iv) an impairment with respect to the individual’s ability in mental functions necessary for everyday life (within the meaning assigned by paragraph 118.4(1)(c.1)), by a medical doctor, a nurse practitioner or a psychologist.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • R.S., 1985, c. 1 (5th Supp.), s. 118.6
  • 1994, c. 7, Sch. II, s. 93, Sch. VIII, s. 57, c. 28, s. 28
  • 1996, c. 11, s. 95
  • 1997, c. 25, s. 28
  • 1998, c. 19, s. 27
  • 1999, c. 22, s. 37
  • 2001, c. 17, s. 98
  • 2002, c. 9, s. 36
  • 2003, c. 15, s. 76
  • 2005, c. 19, s. 25, c. 34, ss. 80, 81
  • 2007, c. 2, s. 23
  • 2011, c. 24, s. 30
  • 2013, c. 34, s. 252, c. 40, ss. 236, 238
  • 2016, c. 7, s. 16
  • 2017, c. 20, s. 19, c. 33, s. 45

Marginal note:Unused tuition, textbook and education tax credits

  •  (1) In this section, an individual’s unused tuition, textbook and education tax credits at the end of a taxation year is the amount determined by the formula

    A + (B - C) - (D + E)

    where

    A
    is the amount determined under this subsection in respect of the individual at the end of the preceding taxation year;
    B
    is the total of all amounts each of which may be deducted under section 118.5 in computing the individual’s tax payable under this Part for the year;
    C
    is the lesser of the value of B and the amount that would be the individual’s tax payable under this Part for the year if no amount were deductible under this Division (other than an amount deductible under this section and any of sections 118 to 118.07, 118.3 and 118.7);
    D
    is the amount that the individual may deduct under subsection (2) for the year; and
    E
    is the tuition tax credit transferred for the year by the individual to the individual’s spouse, common-law partner, parent or grandparent.
  • Marginal note:Deduction of carryforward

    (2) For the purpose of computing an individual’s tax payable under this Part for a taxation year, there may be deducted the lesser of

    • (a) the amount determined under subsection (1) in respect of the individual at the end of the preceding taxation year, and

    • (b) the amount that would be the individual’s tax payable under this Part for the year if no amount were deductible under this Division (other than an amount deductible under this section and any of sections 118 to 118.07, 118.3 and 118.7).

  • (3) [Repealed, 2007, c. 2, s. 24]

  • Marginal note:Change of appropriate percentage

    (4) For the purpose of determining the amount that may be deducted under subsection (2) in computing an individual’s tax payable for a taxation year, in circumstances where the appropriate percentage for the taxation year is different from the appropriate percentage for the preceding taxation year, the individual’s unused tuition, textbook and education tax credits at the end of the preceding taxation year is deemed to be the amount determined by the formula

    A/B × C

    where

    A
    is the appropriate percentage for the current taxation year;
    B
    is the appropriate percentage for the preceding taxation year; and
    C
    is the amount that would be the individual’s unused tuition, textbook and education tax credits at the end of the preceding taxation year if this section were read without reference to this subsection.
  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1998, c. 19, s. 28
  • 2000, c. 12, s. 142
  • 2001, c. 17, s. 99
  • 2006, c. 4, s. 65
  • 2007, c. 2, s. 24
  • 2009, c. 31, s. 6
  • 2011, c. 24, s. 31
  • 2014, c. 20, s. 12
  • 2016, c. 7, s. 17

Marginal note:Credit for interest on student loan

 For the purpose of computing an individual’s tax payable under this Part for a taxation year, there may be deducted the amount determined by the formula

A × B

where

A
is the appropriate percentage for the year; and
B
is the total of all amounts (other than any amount paid on account of or in satisfaction of a judgement) each of which is an amount of interest paid in the year (or in any of the five preceding taxation years that are after 1997, to the extent that it was not included in computing a deduction under this section for any other taxation year) by the individual or a person related to the individual on a loan made to, or other amount owing by, the individual under the Canada Student Loans Act, the Canada Student Financial Assistance Act, the Apprentice Loans Act or a law of a province governing the granting of financial assistance to students at the post-secondary school level.
  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • 1999, c. 22, s. 38
  • 2014, c. 39, s. 35

Marginal note:Credit for EI and QPIP premiums and CPP contributions

 For the purpose of computing the tax payable under this Part by an individual for a taxation year, there may be deducted the amount determined by the formula

A × B

where

A
is the appropriate percentage for the year; and
B
is the total of
  • (a) the total of all amounts each of which is an amount payable by the individual as an employee’s premium or a self-employment premium for the year under the Employment Insurance Act, not exceeding the maximum amount of such premiums payable by the individual for the year under that Act,

  • (a.1) the total of all amounts each of which is an amount payable by the individual as an employee’s premium for the year under the Act respecting parental insurance, R.S.Q., c. A-29.011, not exceeding the maximum amount of such premiums payable by the individual for the year under that Act,

  • (a.2) the amount, if any, by which the total of all amounts each of which is an amount payable by the individual in respect of self-employed earnings for the year as a premium under the Act respecting parental insurance, R.S.Q., c. A-29.011, (not exceeding the maximum amount of such premiums payable by the individual for the year under that Act) exceeds the amount deductible under paragraph 60(g) in computing the individual’s income for the year,

  • (b) the total of all amounts each of which is an amount payable by the individual for the year as an employee’s contribution under subsection 8(1) of the Canada Pension Plan or as a like contribution under a provincial pension plan, as defined in section 3 of that Act, not exceeding the maximum amount of such contributions payable by the individual for the year under the plan, and

  • (c) the amount by which

    • (i) the total of all amounts each of which is an amount payable by the individual in respect of self-employed earnings for the year as a contribution under the Canada Pension Plan or under a provincial pension plan within the meaning assigned by section 3 of that Act (not exceeding the maximum amount of such contributions payable by the individual for the year under the plan)

    exceeds

    • (ii) the amount deductible under paragraph 60(e) in computing the individual’s income for the year.

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • R.S., 1985, c. 1 (5th Supp.), s. 118.7
  • 1996, c. 23, par. 187(d)
  • 2001, c. 17, s. 100
  • 2013, c. 34, s. 253
  • 2016, c. 14, s. 68

Marginal note:Transfer of unused credits to spouse or common-law partner

 For the purpose of computing the tax payable under this Part for a taxation year by an individual who, at any time in the year, is a married person or a person who is in a common-law partnership (other than an individual who, by reason of a breakdown of their marriage or common-law partnership, is living separate and apart from the individual’s spouse or common-law partner at the end of the year and for a period of 90 days commencing in the year), there may be deducted an amount determined by the formula

A + B - C

where

A
is the tuition tax credit transferred for the year by the spouse or common-law partner to the individual;
B
is the total of all amounts each of which is deductible under subsection 118(1), because of paragraph (b.1) of the description of B in that subsection, or subsection 118(2) or (3) or 118.3(1) in computing the spouse’s or common-law partner’s tax payable under this Part for the year; and
C
is the amount, if any, by which
  • (a) the amount that would be the spouse’s or common-law partner’s tax payable under this Part for the year if no amount were deductible under this Division (other than an amount deductible under subsection 118(1) because of paragraph (c) of the description of B in that subsection, under subsection 118(10) or under any of sections 118.01 to 118.07, 118.3, 118.61 and 118.7)

exceeds

  • (b) the lesser of

    • (i) the total of all amounts that may be deducted under section 118.5 in computing the spouse’s or common-law partner’s tax payable under this Part for the year, and

    • (ii) the amount that would be the spouse’s or common-law partner’s tax payable under this Part for the year if no amount were deductible under this Division (other than an amount deductible under any of sections 118 to 118.07, 118.3, 118.61 and 118.7).

  • [NOTE: Application provisions are not included in the consolidated text
  • see relevant amending Acts and regulations.]
  • R.S., 1985, c. 1 (5th Supp.), s. 118.8
  • 1994, c. 7, Sch. VIII, s. 58
  • 1997, c. 25, s. 29
  • 1998, c. 19, s. 29
  • 1999, c. 22, s. 39
  • 2000, c. 12, ss. 133, 142, c. 19, s. 26
  • 2007, c. 2, s. 25, c. 29, s. 10
  • 2009, c. 31, s. 7
  • 2011, c. 24, s. 32
  • 2014, c. 20, s. 13
  • 2016, c. 7, s. 18
 
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