Co-op Tax Credit

June 07, 2017

LandingBanner_679x220_YoungPeople_CasualMeeting_ThinkstockPhotos-494374653.jpg

Employers who hire students enrolled in a co-operative (Co-op) education program at an Ontario university or college are eligible to apply for the Co-operative Education Tax Credit. The Co-op tax credit is a refundable tax credit that creates a reciprocal relationship in which the student and employer can both benefit greatly.

The government seeks to connect companies with ambitious and diligent students from across Ontario through the Co-op Tax Credit. In doing so, students have the opportunity to gain valuable work experience that can contribute to a more successful undergrad and future. Employers will also benefit from having a fresh perspective supporting their business. 

The Co-op Tax Credit’s funding is based on the wage and salary that the student in the co-op education work placement would receive. Corporations can claim 25% of eligible expenditures and small businesses can claim 30% of eligible expenditures. Each qualifying work placement can receive a maximum credit of $3,000. The employment period for most work placements is a minimum of ten weeks up to a maximum of four months. 

This funding program accepts applications throughout the year.

Who is eligible?

Eligibility is outlined by the following details; a work placement must consist of a student who is enrolled at a qualified educational institution, who executes duties that fall in line with their school’s co-op program specifications and do so for an eligible employer. 

The work placement is required to have the following:

  • The placement has been developed or approved by an eligible educational institution
  • The student must engage in productive work and not just be an observer
  • For qualifying internship programs the placement is no less than eight months but no more than sixteen months
  • For all other qualifying co-op education programs, the placement must be at least ten weeks
  • Student must be paid for duties
  • The employer is obligated to supervise and evaluate the student’s job performance

How can BDO help?

BDO’s Advisory Services group can help prepare you for the Co-op Tax Credit and application process. BDO is available to assist with activity scoping to determine eligibility and technical and financial application preparation. As well, we can provide a strategic approach in determining how government grants and incentives, including the Co-op Tax Credit, fit into your company’s future growth plans. For more information, contact your local BDO office.

This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our privacy statement for more information on the cookies we use and how to delete or block them.