Ontario co-operative education tax credit

Individuals operating unincorporated businesses may be eligible for the Ontario co-operative education tax credit.

Include the amount of credit you claimed for 2023 as self-employment income on your 2024 return.

If you were a member of a partnership, other than as a limited partner, you may claim your share of the partnership's credit for each qualifying co-op work placement. Limited partners are not entitled to this credit; however, the general partners of a limited partnership may share the credit.

The total claimed by all partners in the partnership cannot be more than the amount calculated for the partnership.

If you were bankrupt in 2023, your trustee may claim the Ontario co-operative education tax credit if you were eligible for the credit during the period when the trustee acted on your behalf.

If you hired one or more co-op students enrolled in an Ontario university or college, you may be able to claim a tax credit of up to 30% of eligible expenditures to a maximum of $3,000 per student per qualifying work placement.

Eligible expenditures

Eligible expenditures are reasonable salaries, wages, and other remuneration paid or payable to a student in a qualifying work placement, or a reasonable fee paid or payable to an employment agency for a qualifying work placement. The student must be employed at your permanent establishment in Ontario.

You must reduce your eligible expenditures by the amount of any government assistance you received, are entitled to receive, or may reasonably expect to receive for the eligible expenditures.

A qualifying work placement is generally four consecutive months ending in the tax year of employment of a student under a qualifying co-operative educational program of an eligible educational institution.

The minimum employment period is 10 consecutive weeks. The maximum employment period is 16 consecutive months.

The eligible educational institution must give you a certificate for each qualifying work placement for each student.

How to claim this credit

You can claim up to $3,000 for eligible expenditures for each qualifying work placement ending in 2023.

If the total salaries and wages paid in the previous tax year were:

• $600,000 or more, claim 25% of eligible expenditures for the qualifying work placement

• $400,000 or less, claim 30% of eligible expenditures for the qualifying work placement

• more than $400,000 but less than $600,000, complete the calculation for line 19 using Worksheet ON479

Enter your claim on line 19 of your Form ON479.

If you repaid government assistance in 2023 that was related to eligible expenditures for this tax credit in a previous year, the amount of assistance you repaid will qualify for the tax credit for 2023.

The tax credit is equal to the amount of government assistance repaid multiplied by the tax credit rate for the year the eligible expenditures were reduced by the assistance.

For more information about this tax credit, go to fin.gov.on.ca/en/bulletins/ct/4014.html or call the Ontario Ministry of Finance at 1-866-ONT-TAXS (1-866-668-8297) or by teletypewriter (TTY) at 1-800-263-7776.

Supporting documents

If you are filing a paper return, do not send any documents. Keep your supporting documents in case you are asked to provide them later.

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