Training Tax Credit for Apprentices

The training tax credit provides refundable income tax credits for apprentices enrolled in programs administered through the Industry Training Authority (ITA).

Learn about:

Eligibility

You’re eligible to claim the training tax credit if you’re:

  • A B.C. resident at the end of December 31 of the taxation year you’re claiming the credit,
  • Registered with the ITA as an apprentice in an eligible program (PDF), and
  • Not enrolled in a public high school, registered in a home schooling program or attending an independent school

See a table of eligible programs and completion requirements (PDF) for apprentices. If you’re registered in a program through the ITA that’s not listed, contact us for more information. 

Types of Training Tax Credits

There are three types of training tax credits:

  • Basic credit for the first two levels of non-Red Seal training programs
  • Completion credit for level 3 or level 4 for both Red Seal and non-Red Seal training programs
  • Enhanced credit for First Nations individuals and persons with disabilities

The federal government also provides a grant for apprentices.

Basic Tax Credit

The basic tax credit is available when you complete the requirements for tax credit level 1 or 2 of a B.C. recognized (non-Red Seal) program on or after January 1, 2007. 

See how the basic tax credit applies in example 1 and example 2.

Completion Tax Credit

The completion tax credit is available when you complete the requirements for tax credit level 3 or 4 of a Red Seal or non-Red Seal program on or after January 1, 2007.

See how the completion tax credit applies in example 3, example 4 and example 5.

Enhanced Tax Credit

An enhanced tax credit is available if you’re a First Nations individual or a person with a disability and:

Eligible First Nations individuals are persons registered as Indians under the Indian Act (Canada). Persons with disabilities refers to individuals who qualify for the federal disability tax credit.

See how the enhanced tax credit applies in example 2.

How to Determine Your Tax Credit Level

There are three ways to meet the requirements for a tax credit level:

Different programs have different requirements for each tax credit level. See a table of eligible programs and completion requirements (PDF).

Work-based Hours

If your program requires you to complete a certain number of work-based hours, you must meet those requirements to claim the tax credit. The hours recorded on your transcript must be the same as, or greater than, the number of hours required to complete a tax credit level. See the table of eligible programs and completion requirements (PDF) for information about which programs require work-based hours.

Submit your work-based hours to the ITA to claim your credits.

Specific Technical Training

If your program requires you to complete specific technical training, you must have a transcript showing that you have completed that training to claim the tax credit. The ITA will issue you a transcript once you finish the technical training and update it each time you complete a training level.

Graduating a Program

To claim a credit for the final level of your program, you must graduate from the program.

To graduate a program you must receive at least one of the following:

  • Certificate of Qualification
  • Certificate of Qualification with an Inter-provincial Red Seal Endorsement
  • Certificate of Apprenticeship

You must have received a certificate from the program that you’re claiming the tax credit for. You can claim only one credit for the program even if you received more than one certificate or certificate and endorsement for graduating from that program.

What You Can Claim

The following table outlines the amounts you can claim for each level you complete of the basic and completion training tax credit, including the enhanced credit.

    Non-Red Seal Non-Red Seal Red Seal Red Seal
  Tax Credit Level Regular Enhanced Regular Enhanced
Basic 1 $1000 $1500 Federal $500
Basic 2 $1000 $1500 Federal $500
Completion 3 $2000 $3000 $2000 $3000
Completion 4 $2500 $3750 $2500 $3750

You can claim more than one tax credit in a year provided you complete the requirements for each level in the year. Levels completed before January 1, 2007 are not eligible for the credits.

Challenging a Program

If you acquired knowledge and skills outside the Canadian apprenticeship system, you can apply to the ITA to be assessed as a challenger to receive trade certification. If you successfully challenged a Red Seal or Non-Red Seal program administered through the ITA after January 1, 2007, you may be entitled to a B.C. training tax credit (certification tax credit).

If you obtained a Certificate of Qualification by successfully challenging a program, look up the program in the table of eligible programs and completion requirements (PDF). Once you find your program, look for ‘graduate program’ under one of the completion levels. You can claim the tax credit associated with the completion level where you find ‘graduate program’.

If you’re claiming a tax credit at completion level 1 or 2, complete Part 1 of the British Columbia Training Tax Credit (T1014) form. If you’re claiming a tax credit for completion level 3 or 4, complete Part 2 of the same form and submit this form with your T1 personal income tax return.

Example

If you successfully challenged the Carpenter program, you're entitled to claim the tax credit level associated with ‘graduate program’. In this case you can claim level 4. Enter the tax credit for level 4 on line 5 in Part 2 of the British Columbia Training Tax Credit (T1014) form.

Program Level 1 Level 2 Level 3 Level 4
Carpenter N/A N/A Complete Level 3 Graduate Program

Challengers who are registered as Indians under the Indian Act (Canada) or are eligible for the federal disability credit may also claim the enhanced tax credit.

Employers of challengers are not eligible to claim the certification tax credit for those challengers.

Claiming the Credit

You can claim the training tax credit in the year the level is completed regardless of which year the level was started.

The training tax credit is a fully refundable tax credit. You must apply the credit against your total taxes payable. If your credit is greater than your total taxes payable, the excess of the credit will be paid out as a refund.

If you complete the requirements of more than one tax credit level during a taxation year, you can claim more than one tax credit.

Claim the training tax credit by completing British Columbia Training Tax Credit (T1014) form and submitting it with your T1 Income Tax Return.

Required Documentation

If you’re claiming a basic tax credit or a completion tax credit, you may be required to provide:

  • A copy of your transcript from the ITA
  • A copy of the certificate you received from the ITA if you’re required to have graduated the program to be eligible for the tax credit

If you’re claiming an enhanced tax credit as a First Nations individual, you may be required to provide a copy of your Certificate of Indian Status card.

If you’re claiming an enhanced tax credit as a person with disabilities, you may be required to provide proof of entitlement.

Examples

See how the three types of training tax credits apply.

Example 1

If you’re registered with the Industry Training Authority for the Aircraft Maintenance Technician program (a non-Red Seal program), the completion requirement for tax credit level 1 is to have completed 1,800 work-based hours. Once your transcript shows that you have completed those hours, you’ll be eligible to claim your basic tax credit of $1,000.

Example 2

You’re registered with the Industry Training Authority for the Heating Technician program (a non-Red Seal program). The completion requirement for tax credit level 2 is to have graduated the program. Once you have graduated and received a Certificate of Qualification or Certificate of Apprenticeship, you’ll be eligible for the basic tax credit. If you’re also eligible for the federal Disability Tax Credit, you’ll be eligible for the basic tax credit of $1,000 plus the enhanced tax credit of $500, for a total credit of $1,500.

Example 3

If you’re registered with the Industry Training Authority for the Plumbing program (a Red Seal program), the completion requirement for tax credit level 3 is to have completed level 3. Once your transcript shows that you have completed technical training level 3, you’ll be eligible to claim your completion tax credit of $2,000.

Example 4

If you’re registered with the Industry Training Authority for the Construction Electrician program (a Red Seal program), the completion requirement for tax credit level 4 is to have graduated the program. Once your transcript shows that you have received a Certificate of Qualification, a Certificate of Qualification with an Inter-Provincial Red Seal Endorsement or a Certificate of Apprenticeship, you’ll be eligible to claim your completion tax credit of $2,500.

Example 5

If you complete technical training level 3 of the Construction Electrician program (a Red Seal program) during 2015, you’ll be entitled to a completion tax credit of $2,000 for the completion of tax credit level 3. If during 2015 you also graduate and receive a Certificate of Qualification with an Inter-Provincial Red Seal Endorsement for the Construction Electrician program, you’ll be entitled to a completion tax credit of $2,500 for the completion of tax credit level 4. The total amount of the tax credit for the 2015 taxation year will be $4,500.

If you owe $3,500 in federal and provincial taxes, you can use the training tax credit to reduce the taxes owed. You’ll receive the remainder of the credit equal to $1,000 ($4,500 - $3,500) as a tax refund.

Frequently Asked Questions

Get answers to your questions about the training tax credit for apprentices.
 

Useful Contacts

Contact us with your general questions about program eligibility:

Contact Canada Revenue Agency with questions about tax credit claims:

  • 1-800-959-8281 (toll free within Canada)
Share Button