ARCHIVED - Ombudsman Update - Earning Credits (2012)

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In March 2012, the Office of the Taxpayers’ Ombudsman completed the report Earning Credits: Service and fairness issues in the assessment of tuition tax credits for expenses incurred attending educational institutions outside Canada.Footnote 1

Students who attend post-secondary educational institutions in Canada are eligible to apply for a non-refundable tax credit for tuition fees, which reduces the amount of income tax the student had to pay. The tuition tax credit is also available to students who attended certain educational institutions outside Canada.Footnote 2  The Canada Revenue Agency (CRA) administers the tuition tax credit.

Our Office initially became aware of possible service issues with the tuition tax credit in 2010. We heard from Canadian students attending foreign educational institutions that the CRA was not providing clear information about their eligibility to claim tuition expenses on their income tax and benefit returns. Media also reported the CRA denied students the tuition tax credit even though they attended well-known universities outside Canada.

To understand the issue, we analyzed complaints received by both our Office and the CRA, and examined the CRA’s procedures for processing claims for tuition tax credits relating to fees paid to educational institutions outside Canada. We also reviewed related information on the CRA website.

Our examination found instances where CRA employees were basing the determination of eligibility on whether (or not) the educational institution was:

Eligibility was therefore not determined on a case-by-case basis by considering the relevant criteria in the ITA. An educational institution does not need to be on any formal list to meet the eligibility criteria in the ITA. Those not on a list maintained or accessed by the CRA must be judged on its own merit at the time a claim for the tuition tax credit is made.

The lists used by CRA employees were not readily accessible to the general public. It was unclear whether the lists used by the CRA could be shared publicly and the CRA was inconsistent in the information it provided when students wanted to confirm if their educational institution was on a list used by the CRA. In one instance a student was told he would have to file an Access to Information request to obtain a copy of the lists.

Overall, we found the CRA could improve how it communicated information about the tuition tax credit for educational institutions outside Canada, and how it determined institutional eligibility.

To address the findings, the Taxpayers’ Ombudsman recommended:

  1. The CRA ensure that determinations on eligibility for the tuition tax credit are based on the provisions of the Income Tax Act and not solely on its internal policies, practices, and procedures.
  2. The CRA provide clear, accurate, and timely information to taxpayers about the criteria for determining eligibility for the tuition tax credit.
  3. The CRA post on its Web site and in other media a list of the educational institutions outside Canada that have already been recognized by the CRA as a university outside Canada for the purpose of paragraph 118.5(1)(b) of the Income Tax Act, while emphasizing that the list is neither determinative nor exhaustive.
  4. The CRA provide a clear and accessible explanation that institutions on the list of qualified donees and Schedule VIII of the Income Tax Act are automatically recognized as universities outside Canada for the purposes of the tuition tax credit.
  5. The CRA consider posting links on its Web site to the lists that are maintained by different organizations in various countries and are utilized by the CRA to verify tuition tax credit claims made by students who attend educational institutions outside Canada.
The CRA agreed to implement the recommendations and provided an action plan outlining how it intended to address them.


In December 2017, the CRA provided an update to our Office on the actions it took to address the recommendations. The CRA stated it regularly updates its manuals to ensure employees have the most up-to-date information. The CRA also indicated updates were made to its website and publications to make the information about the tuition tax credit clearer and more accessible. Some of these updates included clarifying that institutions found in Schedule VIII of the ITA Regulations and those on the CRA’s list of qualified donees are recognized as an eligible “university outside Canada” for the purposes of the tuition tax credit.

On its Information Sheet RC190 – Information for Educational Institutions Outside Canada, the CRA added links to other organizations’ websites it used to verify claims for the tuition tax credit. The RC190 also provides instruction to students to contact the CRA if they need more information.Footnote 3

In addition to the update provided by the CRA, we conducted further research and requested additional information from the CRA.

On March 28, 2013, Income Tax Folio S1-F2-C2, Tuition Tax Credit, replaced Interpretation Bulletin IT–516R2, Tuition Tax Credit, concerning a student's eligibility to claim or transfer a tuition tax credit.Footnote 4  The CRA stated the change consolidated the former interpretation bulletin and improved readability. It added a new section to highlight the four distinct provisions of subsection 118.5(1) of the ITA, and clarified the definition of “university”. Also in the Folio, under Educational institutions outside Canada, relevant information was added which: 

That section also states the CRA maintains a list of institutions outside Canada that are considered universities for the purpose of the tuition tax credit. However, there is no information on how to access that list. Students are instructed to contact the CRA’s general enquiries line. Furthermore, this folio does not state that institutions on the CRA’s list of qualified donees are recognized as an eligible “university outside Canada” within the meaning of the ITA.

Both information sheets state that institutions recognized by the Institute of Education Sciences National Center for Education Statistics and the Council for Higher Education Accreditation, and any institution that is part of the Association of Commonwealth Universities, qualify for the tuition tax credit.Footnote 5  While no specific universities are listed on the information sheets, links to the respective websites for these three external organizations are included. Information Sheets RC190 and RC192 state that registered institutions outside Canada on the CRA’s list of qualified donees are eligible for the purpose of the tuition tax credit, and RC 190 provides a link to the list.

Neither information sheet references specific educational institutions already formally recognized through the CRA’s application process.

The Folio directs individuals seeking a less technical overview to a separate document entitled P105 Students and Income TaxFootnote 6  and to videos called Series: Canadian Students and Income Tax.Footnote 7  We reviewed these pages and a related video (Segment 7: Claiming tuition fees, education amounts and textbook amounts) and did not find reference to the relevant section of the ITA, its Regulations (Schedule VIII) or to the CRA’s qualified list of donees, for the purposes of determining whether or not an institution is an eligible “university outside Canada” within the meaning of the ITA.Footnote 8

We asked the CRA about its current procedures for determining eligibility of an institution not found on the lists it maintains or uses, and how it ensures the eligibility determination made by a CRA employee is made in accordance with subsection 118.5 of the ITA. The CRA stated its policy is for field officers to review the institution’s official website and the website of the Ministry of Education for the country where the institution is located to confirm if it meets the requirements for the purposes of the tuition tax credit. In the event the field officers are unable to make a determination, an employee at the CRA’s Headquarters will assist in making a determination.

In 2018, the CRA published a list entitled Recognized universities and higher educational institutions outside Canada on its external website.Footnote 9  This list is easy to find, located alongside information on other tax credits for those completing a tax return.Footnote 10  As of December 31, 2019, there were 496 educational institutions on the list. A message on the page advises readers the list is not all-inclusive and may be subject to change.



The key issue in the initial examination was that the CRA was denying students their tuition tax credit claims, either because the educational institution they attended outside Canada was not on a pre-approved list, or because CRA personnel did not make a determination of eligibility based on the ITA.

After reviewing the issue, we feel the CRA has implemented steps to ensure determinations related to the tuition tax credit are based on the provisions in the ITA and not solely on its internal policies and procedures (including its pre-approved lists). The CRA has increased its transparency by providing links to and publishing the lists it relies upon for decision making. It is our view the updates the CRA has made have generated positive changes for students looking to claim the tuition tax credit.

Opportunities for greater consistency in information remain. For example, we found information in one publication or webpage may not be in another. It would be beneficial for the CRA to ensure that information about the tuition tax credit, especially information about the eligibility of educational institutions, listed in the ITA Regulations (Schedule VIII), the CRA’s list of qualified donees, and institutions already recognized by the CRA, is available consistently throughout the CRA’s publications and webpages. Updates to Folio S1-F2-C2, Tuition Tax Credit and Information Sheet RC192 – Information for Students - Educational Institutions Outside Canada to include a link to the CRA’s published list of recognized institutions would assist students in finding this information in a timely manner.

The Taxpayers’ Ombudsman finds the CRA has taken appropriate steps to address the issues raised, and the recommendations in Earning Credits.


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