Ontario Co-operative Education Tax Credit – Ontario Ministry of Finance

Description:

The 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. Most work placements are for a minimum employment period of 10 weeks up to a maximum of four months.

Comments on Funding:

Funding is up to 25% for corporations and 30% for small businesses of the eligible expenditures incurred by the corporation for a qualifying work placement. The maximum credit is $3,000 per placement.

For eligible expenditures incurred after March 26, 2009:

  1. Small businesses are entitled to the CETC at 30%.
  2. Taxpayers with payrolls of $600,000 or more are entitled to the CETC at 25%.
  3. Eligible employers may claim a refundable tax credit equal to the lesser of:
  • 25% (30% for small businesses for qualifying work placements) of the eligible expenditures made in respect of that work placement, and
  • $3,000.

For eligible expenditures incurred before March 27, 2009:

  1. A small business whose total payroll in the previous taxation year was $400,000 or less is entitled to the CETC at 15%.
  2. Taxpayers with payrolls of $600,000 or more are entitled to the CETC at 10%.
  3. Eligible employers may claim a refundable tax credit equal to the lesser of:
  • 10% (15% for small businesses) of the eligible expenditures made in respect of the work placement, and
  • $1,000.

Eligibility:

The applicant must:

  • be a corporation or an unincorporated businesses,
  • have permanent establishments in Ontario subject to Ontario corporate income tax or Ontario personal income tax. 
  • hire students enrolled in a post-secondary co-operative education program.

Documentation Needed:

The applicant must:

  • File a completed Schedule 550, Ontario Co-operative Education Tax Credit, with his return if an eligible corporation. OR Eligible employers operating unincorporated businesses can claim the tax credit on form ON479 – Ontario Credits, included in their personal income tax return. Members of a partnership can claim their share of the CETC on their own corporate or personal tax returns.
  • Keep a copy of the letter of certification from the eligible educational institution in Ontario to support their tax credit claim.

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *