Ontario Apprenticeship Training Tax Credit or the Ontario Co-operative Education Tax Credit

What’s in this Article?

 

What is this?

The Ontario Apprenticeship Training Tax Credit is a refundable tax credit for unincorporated businesses and corporations, employing apprentices in certain skilled trades during the first 36 months (for apprenticeships that started on or after April 23, 2015) of an apprenticeship program. For apprenticeships that started before April 23, 2015, the first 48 months of the apprenticeship qualify for the tax credit. The tax credit is based on the salary and wages paid to the apprentice and qualifying businesses can claim a portion of the eligible expenditures during the specified period of the apprenticeship program.

Canada Revenue Agency (CRA) says

Eligible expenditures are reasonable salaries and wages you paid to an apprentice employed in a qualifying apprenticeship at a permanent establishment of yours in Ontario, or reasonable fees paid or payable to an employment agency, for services provided by the apprentice during the first 48 months of the apprenticeship training program.

You must reduce your eligible expenditures by the amount of any government assistance you received, are entitled to receive or may reasonably expect to receive for the eligible expenditures.

 

The Ontario Co-operative Education Tax Credit is a refundable tax credit available to employers who hire students enrolled in a co-operative education program at an Ontario university or college.  The tax credit is based on salaries and wages paid to the student in a co-operative education work placement. The credit that can be claimed is up to 25% to 30% of eligible expenditures to a maximum of $3,000 per student per quality work placement. Most work placements are for a minimum employment period of 10 weeks up to a maximum of four months.

Canada Revenue Agency (CRA) says

Eligible expenditures are reasonable salaries, wages, and other remuneration paid or payable to a student in a qualifying work placement, or a reasonable fee paid or payable to an employment agency for a qualifying work placement. The student must work at a permanent establishment of yours in Ontario.

You must reduce your eligible expenditures by the amount of any government assistance you received, are entitled to receive, or may reasonably expect to receive for the eligible expenditures.

A qualifying work placement is generally four consecutive months ending in the tax year of employment of a student under a qualifying co-operative educational program of an eligible educational institution. The minimum employment period is 10 consecutive weeks. The maximum employment period is 16 consecutive months. The eligible educational institution must provide you with a certificate for each qualifying work placement for each student

 

Am I eligible?

If you are an employer operating an unincorporated business and hired one or more eligible apprentices you can claim the Apprenticeship Training Tax Credit on form ON479: Ontario Credits included in your income tax return. Your business must have a permanent establishment in Ontario and pay Ontario income tax. If you hired one or more co-op students enrolled in an Ontario University or College, you can claim the Co-operative Education Tax Credit on the same form.

You will need to have the following information on hand when you complete the form:

  • Amount of eligible expenditures paid in 2015 for an apprentice who started an apprenticeship program on or before April 23, 2015;
  • Amount of eligible expenditures paid in 2015 for an apprentice who started an apprenticeship program after April 23, 2015;
  • Total amount of salaries and wages paid in 2015 for apprentices and/or co-op students;
  • The number of eligible apprentices your business or partnership hired under the Ontario apprenticeship training tax credit program;
  • The amount of eligible expenses, such as salaries and wages, incurred for your apprentice(s);
  • The number of eligible work placements your business or partnership is claiming under the Ontario co-operative education tax credit program; and
  • If you are claiming one or more of these credits as a member of a partnership.

 

 Where do I claim this?

Important: Before you begin, ensure that you have told us that you lived in ONTARIO on December 31st of the 2015 tax year, in H&R Block’s tax software. To do this:

  1. Click the HOME tab.
  2. Click the ABOUT YOU icon and click the Your residence icon. You will find yourself here:

Once you have confirmed your residence location, claim your Ontario apprenticeship training or co-operative education tax credit by following these steps:

  1. Click the PREPARE tab.
  2. Click the YOUR YEAR IN REVIEW icon. You will find yourself here:

  3. Click the checkbox labelled I worked for myself and select the province of your self-employment.
  4. Click the EMPLOYMENT icon. You will find yourself here:

  5. Under the CREDITS AND REBATES heading, select the checkbox labelled Ontario self-employment credits.
  6. Scroll to the bottom of the page and click Continue.

When you arrive at the appropriate page for the Ontario self-employment credits, enter your information into the tax software.

 

Where can I learn more?