The Canada training credit (CTC) is a new refundable tax credit available for 2020 and later years to help Canadians with the cost of eligible training fees. The credit may be claimed for tuition and other fees paid for courses you took in the year for which you are claiming the credit.
You claim the CTC when you complete your income tax and benefit return.
Starting in 2019, if you are eligible, you accumulate $250 in your CTC limit each year, up to a maximum of $5,000 in a lifetime.
Who Can Apply?
To be eligible for the Canada training credit (CTC) you must satisfy the following conditions:
- you file an income tax and benefit return for the year
- your CTC limit for the year is greater than zero
- you were resident in Canada throughout the year
- tuition or other fees were paid either to an eligible educational institution for courses you took in the year for which you are claiming the credit, or to certain bodies for an occupational, trade or professional examination
- the tuition and fees are otherwise eligible for the existing tuition tax credit
- You were between the age of 26 and 65 at the end of the calendar year
Canada training credit limit
An individual who is at least 25 years old and less than 65 years old at the end of a calendar year can accumulate $250 in their Canada training credit (CTC) limit for the next tax year, up to a maximum of $5,000 in a lifetime, provided they satisfy all of the following conditions for the year:
- file an income tax and benefit return for the year
- are a resident in Canada throughout the year
- have a total working income (including maternity and parental benefits) of $10,100 or more in 2020
- have individual net income for 2020 that does not exceed $150,473
Even in years that you make a claim for the CTC, you can still accumulate $250 in your CTC limit for the next tax year.
Eligible educational institution
An eligible educational institution for the purpose of calculating the CTC is either of the following:
- a university, college or other educational institution in Canada providing courses at a post-secondary level
- an institution in Canada providing occupational skills courses, which is certified by the minister of employment and social development
How much can you get?
If the Canada training credit is claimed on your tax return, the benefit will reduce your tax owing. If the credit is more than your tax owing, you may get a refund for the difference.
The amount of the CTC will be the lesser of:
- half of the eligible tuition and fees you paid for the year
- your CTC limit for the tax year
Your CTC limit will be communicated to you each year on your latest notice of assessment or notice of reassessment and will be available through the Canada Revenue Agency’s My Account portal.
How to calculate your credit amount
The following formula explains how to calculate your Canada training credit (CTC) limit:
A + B - C where:
A is the CTC limit for the previous tax year.
B is the annual accumulation of $250 (if you satisfy all the annual accumulation conditions, if not, B will be zero).
C is the CTC claimed in the previous year.
How much you can accumulate
Beginning in 2019, you may be able to accumulate $250 in each year that you are eligible, for use in calculating your CTC for a future year, up to a maximum of $5,000.
You will stop accumulating the CTC limit when:
- Your total accumulation is $5000
- You turn 65 years old
Individuals under the age of 26 or over the age of 65 at the end of a year have a CTC limit for the year of zero, and so cannot claim the CTC for tuition and fees incurred for that year.
How to apply
You can claim the Canada training credit (CTC) when you complete your income tax and benefit return. If you file a paper return, fill out Schedule 11 in your income tax package. Your CTC limit will be communicated to you each year on your notice of assessment and will be available through the Canada Revenue Agency’s My Account portal. Your 2019 notice of assessment will indicate your CTC limit for 2020 that may be used if you pay eligible tuition and fees for courses taken in 2020, and you want to claim the CTC on your 2020 income tax and benefit return for those fees.
For more information about this credit, please contact our personal tax expert, Dan Oler, or complete the contact form below.
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