Ontario Co-Operative Education Tax Credit (CETC)

Provides a tax credit to assist small businesses in Ontario that hire students enrolled in an Ontario post-secondary school co-op program.

Ontario Ministry of Agriculture, Food and Rural Affairs

Overview of the Ontario Co-Operative Education Tax Credit (CETC) program:

The Co-operative Education Tax Credit (CETC) is a refundable tax credit available to employers who hire students enrolled in a recognized Ontario university or college co-operative education program. The Canada Revenue Agency (CRA) administers the program on behalf of Ontario through the federal income tax system.

Benefits of the Ontario Co-Operative Education Tax Credit (CETC) program:

An eligible employer may claim a refundable tax credit for each qualifying work placement ending in the taxation year. The 2009 Ontario Budget introduced enhancements to the CETC for expenditures incurred after March 26, 2009. The CETC reimburses employers 25 per cent of eligible expenditures. Smaller businesses are eligible for a higher credit rate of 30 per cent. The maximum credit for each qualifying work placement is $3,000. Most work placements are for a minimum employment period of 10 weeks up to a maximum of four months.
Eligible expenditures made by a business in respect of a qualifying work placement are:
Salaries and wages including taxable benefits paid or payable to the student in respect of the qualifying work placement at an Ontario permanent establishment (place of business)
Fees paid or payable to an employment agency in respect of the qualifying work placement for the services of a student carried out primarily at an Ontario place of business.

Eligibility criteria of the Ontario Co-Operative Education Tax Credit (CETC) program:

Eligible employers must:
Have a permanent establishment located in Ontario, and
Be subject to Ontario income tax, and
Incur eligible expenditures associated with hiring co-op students enrolled in an Ontario university or college.
Eligible employers must hold a certified document from an eligible educational institution confirming that the employer has provided a placement to a student in respect of a qualifying co-op work placement. Although members of a partnership may share the CETC, limited partners are not entitled to this credit
The tax credit can be claimed on the return of a person who died in the tax year.