How much funding can be received?

Funds up to 25% of admissible expenses, capped at $3000 per project.

What is the deadline to apply?

The deadline to apply is not specified.

Who are the financial supporters of the Co-operative Education Tax Credit?

Co-operative Education Tax Credit is funded by Ontario Ministry of Finance, Government of Ontario

What are Co-operative Education Tax Credit's eligibility criterias?

The employer must be a corporation or an unincorporated business with a permanent establishment in Ontario subject to Ontario corporate or personal income tax. Members of partnerships (excluding limited partners) can share the credit for qualifying work placements. Associated corporations hiring the same student must designate one corporation to claim the work placements for the credit.

Co-operative Education Tax Credit

Last Update: February 27, 2025

ON, Canada

Ontario co-op student tax credit

Co-operative Education Tax Credit at a glance

Eligible Funding

Max. $3,000
Up to 25% of project cost

Timeline

Open Date : November 14, 2019

Financing Type

Tax Credits

Eligible Industries

All industries

Grant Providers

Ontario Ministry of Finance
Government of Ontario

Status

Open

Overview of the Co-operative Education Tax Credit program

Access a refundable tax credit of 30% to a maximum of $3,000 per placement to hire co-op students.

Eligible projects & activities

Examples of admissible projects:

$ 3,000

Hiring a co-op student to support digital marketing efforts for four months

$ 3,000

Bringing on a co-op student to optimize operational processes for three months

$ 3,000

Engaging a co-op student for conducting market research for a new product line over five months

$ 3,000

Bringing a co-op student on board to develop a new mobile application for six months

$ 3,000

Engaging a student to assist with community outreach program development for six months

$ 3,000

Hiring a co-op student to support IT helpdesk operations for two months

Eligibility criteria of the Co-operative Education Tax Credit program

Eligibility for the Co-operative Education Tax Credit requires businesses to meet specific criteria related to their operations and the employment conditions they provide.

The employer must be a corporation or unincorporated business with a permanent establishment in Ontario.
The employer must be subject to Ontario corporate income tax or Ontario personal income tax.
Salaries and wages, including taxable benefits paid to the student for the work placement, must be attributable to an Ontario permanent establishment.
If government assistance is received, it will reduce the amount of eligible expenditure for the tax credit claim.
The employer must supervise and evaluate the student's job performance during the work placement.

Who is eligible?

Ontario businesses that hire students enrolled in post-secondary co-operative education programs at Ontario colleges or universities.

Who is not eligible

Some types of companies might not be eligible for the Co-operative Education Tax Credit. They could include:

Limited partners in a partnership

Eligible expenses

This grant provides tax credits to Ontario businesses hiring students enrolled in qualifying co-operative education programs. The eligible activities concentrate on creating meaningful work placements that align with academic objectives and support experiential learning.

Hiring students for work placements developed or approved by eligible educational institutions.
Engaging students in productive work during their placement rather than mere observation.
Offering work placements ranging from 10 weeks to 16 months, depending on the educational program type.
Paying students for their work during the placement period.
Supervising and evaluating student's job performance throughout the work placement.
Ensuring educational institutions monitor the student's progress in the work placement.

Eligible geographic areas

Ontario businesses can apply for this tax credit as it targets employers with permanent establishments within the province. Eligible companies must be participating in co-operative education programs offered by institutions in Ontario.

Businesses with permanent establishments in Ontario.

Eligibility criteria of the Co-operative Education Tax Credit program

There are evaluation and selection criteria for this grant as follows:

The employer must be an eligible corporation or unincorporated business with a permanent establishment in Ontario and subject to Ontario corporate income tax.
The work placement must adhere to specific conditions such as duration, integration with academic studies, and student payment.
Government assistance received for the work placement may impact the eligibility of expenditures for the tax credit.

How to apply to the Co-operative Education Tax Credit program

Determine Eligibility

Verify that your business qualifies as an eligible employer with a permanent establishment in Ontario.
Ensure the work placement qualifies under the co-operative education program criteria.

Certification from Educational Institution

Contact the eligible educational institution to obtain a certification letter.
Ensure the letter certifies the student’s enrolment and the work placement details.

Calculate the Tax Credit

Determine the total eligible expenditures for the student’s work placement.
Calculate the tax credit based on your total payroll and eligible expenditures.

Complete the Necessary Tax Form

For corporations, fill out Schedule 550 to file with the T2 Corporation Income Tax Return.
For unincorporated businesses, complete Form ON479 with the Personal Income Tax Return.

Submit the Application

Include the completed forms with your relevant tax returns.
Make sure the return is filed by the tax year in which the work placement ends.

Retain Supporting Documentation

Keep a copy of the certification letter for at least 7 years.
Ensure all supporting documents are accessible in case of an audit.

Amendments and Inquiries

If needed, request amendments to previous returns through the appropriate tax center for incorporated businesses or by following federal instructions for unincorporated businesses.
Contact the Canada Revenue Agency for any questions regarding the credit.

Additional information

Here are additional relevant details for this grant:

Work placements for students in co-operative education programs must be certified by the educational institution, ensuring they meet the program requirements and duration criteria.
The credit amount varies based on the employer's total payroll from the previous year, with maximum credit limits applicable per work placement.
Employers may need to amend previous tax returns if changes to the credit claim are necessary and must do so within specific time frames depending on corporation type.
The entire credit amount must be reported as income in the tax year it is received, impacting the business's taxable income.
Employers should retain supporting documentation, such as a letter of certification from the student's educational institution, for at least seven years for possible audits.