88 (1) A taxpayer who complies with the requirements of this section may claim an amount for a taxation year in respect of and not exceeding the taxpayer’s co-operative education tax credit for the year.  2007, c. 11, Sched. A, s. 88 (1). Amount of tax credit (2) The amount of a taxpayer’s co-operative education tax credit for a taxation year is the sum of, (a) all amounts each of which is in respect of a qualifying work placement that ends in the year, equal to the lesser of, (i) the taxpayer’s eligible amount for the year in respect of the qualifying work placement as determined under subsection (8), and (ii) the maximum amount for the qualifying work placement for the year determined under subsection (2.1); and (b) the total of all amounts, each of which is an amount determined by multiplying the eligible percentage by the amount of a repayment, if any, made by the taxpayer during the year, of government assistance in respect of a qualifying work placement to the extent the repayment does not exceed the amount of the assistance in respect of the qualifying work placement that, (i) has not been repaid in a previous taxation year, and (ii) may reasonably be considered to have reduced the amount of a co-operative education tax credit that would otherwise have been allowed to the taxpayer under this Act, the Corporations Tax Act or the Income Tax Act in respect of the qualifying work placement.  2007, c. 11, Sched. A, s. 88 (2); 2009, c. 18, Sched. 28, s. 9 (1). Maximum amount for qualifying work placement (2.1) The maximum amount for a qualifying work placement for a taxation year is the amount calculated using the formula, ($1,000 × X/Y) + [$3,000 × (Y – X)/Y] in which, “X” is the number of consecutive weeks of the qualifying work placement completed by the student before March 27, 2009, and “Y” is the total number of consecutive weeks of the student’s qualifying work placement. 2009, c. 18, Sched. 28, s. 9 (2). Qualifying work placement (3) For the purposes of this section, a work placement is a qualifying work placement if, (a) it is a work placement in which a student of an eligible educational institution performs employment duties for a taxpayer under a qualifying co-operative education program offered by the institution; (b) it satisfies the conditions set out in subsection (4); and (c) it is certified as a qualifying work placement under subsection (14).  2007, c. 11, Sched. A, s. 88 (3). Additional conditions (4) The following are the conditions referred to in clause (3) (b): 1. The work placement has been developed or approved by the institution as a suitable learning situation. 2. The terms of the work placement require the student to engage in productive work during the placement, not just to observe the work of others. 3. The work placement is for a period of, i. not less than 10 consecutive weeks, if the placement is under a  program referred to in subparagraph 2 i of subsection (5), or ii. not less than eight consecutive months and not more than 16 consecutive months, if the placement is under a program described in subparagraph 2 ii of subsection (5). 4. The student is entitled to receive remuneration for work performed during the work placement. 5. The terms of the work placement require the corporation to supervise and evaluate the job performance of the student during the placement. 6. The institution monitors the student’s progress in the work placement.  2007, c. 11, Sched. A, s. 88 (4). Qualifying co-operative education program (5) An educational program or course of study is a qualifying co-operative education program for the purposes of this section if it meets the following requirements: 1. The program or course of study formally integrates students’ academic studies with work placements. 2. The program or course of study, i. includes work placements, each of which is at least 10 consecutive weeks and at least half of which are mandatory, that total not more than 75 per cent of the time spent in required academic study and that include mandatory work placements totalling at least 30 per cent of the time spent in required academic study, or ii. includes one optional work placement of at least eight consecutive months and not more than 16 consecutive months that totals at least 30 per cent and not more than 75 per cent of the time spent in required academic study. 3. All optional work placements taken under the program or course of study must be completed before the start of the final academic term. 4. The program or course of study provides credit towards a post-secondary degree, diploma or certificate granted by an eligible educational institution in respect of qualifying co-operative education programs. 5. All optional qualifying work placements taken by a student under the program or course of study are recorded on the student’s academic transcripts. 6. The Senate, board of governors or other governing body of the eligible educational institution, through its authorized delegate, has given to the Minister of Finance, or to his or her delegate, a document stating that the program or course of study meets the requirements of paragraphs 1 to 5.  2007, c. 11, Sched. A, s. 88 (5). Division of work placement into consecutive work placements (6) If a qualifying work placement would otherwise exceed four consecutive months, the following rules apply: 1. The work placement shall be divided into periods of four consecutive months, starting at the beginning of the placement, and each full period of four consecutive months is deemed to be a separate qualifying work placement. 2. If the work placement includes a period of 10 or more consecutive weeks that is not included in a period deemed by paragraph 1 to be a separate qualifying work placement, the period of 10 or more consecutive weeks is deemed to be a separate qualifying work placement. 3. If the work placement includes a period of less than 10 consecutive weeks that is not included in a period deemed by paragraph 1 or 2 to be a separate qualifying work placement, the period of less than 10 consecutive weeks is deemed to form part of the immediately preceding period that is deemed by paragraph 1 to be a separate qualifying work placement.  2007, c. 11, Sched. A, s. 88 (6). Work placements with associated corporations (7) Consecutive work placements with two or more associated corporations are deemed to be with only one of the corporations, as designated by the corporations.  2007, c. 11, Sched. A, s. 88 (7). Eligible amount (8) A taxpayer’s eligible amount for a taxation year in respect of a qualifying work placement is determined as follows: 1. If the total of all salaries or wages paid by the taxpayer in the previous taxation year is equal to or greater than $600,000, the eligible amount is the sum of, i. 10 per cent of the sum of all eligible expenditures incurred by the taxpayer in respect of the qualifying work placement before March 27, 2009, and ii. 25 per cent of the sum of all eligible expenditures incurred by the taxpayer in respect of the qualifying work placement after March 26, 2009. 2. If the total of all salaries or wages paid by the taxpayer in the previous taxation year is not greater than $400,000, the eligible amount is the sum of, i. 15 per cent of the sum of all eligible expenditures incurred by the taxpayer in respect of the qualifying work placement before March 27, 2009, and ii. 30 per cent of the sum of all eligible expenditures incurred by the taxpayer in respect of the qualifying work placement after March 26, 2009. 3. If the total of all salaries or wages paid by the taxpayer in the previous taxation year is greater than $400,000 but less than $600,000, the eligible amount is calculated using the formula, (10% × E) + (25% × F) + [(5% × G) × (1 – H/$200,000)] in which, “E” is the sum of all eligible expenditures incurred by the taxpayer in respect of the qualifying work placement before March 27, 2009, “F” is the sum of all eligible expenditures incurred by the taxpayer in respect of the qualifying work placement after March 26, 2009, “G” is the sum of all eligible expenditures incurred by the taxpayer in respect of the qualifying work placement, and “H” is the amount by which the total of all salaries or wages paid by the taxpayer in the previous taxation year exceeds $400,000. 2009, c. 18, Sched. 28, s. 9 (3). Same (9) The amount of salaries or wages deemed to have been paid by a corporation in a previous taxation year for the purposes of subsection (8) is the amount that would otherwise be determined for that year if the rules set out in subsections 87 (1.2) and (1.4) of the Federal Act applied.  2007, c. 11, Sched. A, s. 88 (9). Eligible expenditures (10) The following amounts paid or payable by a taxpayer in respect of a qualifying work placement are eligible expenditures for a taxation year: 1. An amount paid or payable to a student in the qualifying work placement if, i. the amount is salary or wages paid or payable on account of employment at a permanent establishment of the taxpayer in Ontario, and ii. the amount is required by subdivision a of Division B of Part I of the Federal Act to be included, when paid, in the student’s income from a source that is an office or employment. 2. A fee paid or payable to an employment agency in consideration for the provision of services performed by the student in the qualifying work placement, if the services are performed by the student primarily at a permanent establishment of the taxpayer in Ontario.  2007, c. 11, Sched. A, s. 88 (10). Government assistance (11) The total of all eligible expenditures made by a taxpayer in respect of a qualifying work placement is the amount otherwise determined less the amount of all government assistance, if any, that, on the taxpayer’s filing-due date for the year, the taxpayer has received, is entitled to receive or may reasonably expect to receive in respect of the eligible expenditures.  2007, c. 11, Sched. A, s. 88 (11). Exceptions (12) Despite subsection (10), an expenditure made by a particular taxpayer in respect of a work placement is not an eligible expenditure for the purposes of this section, (a) to the extent that the amount of the expenditure would not be considered to be reasonable in the circumstances by taxpayers dealing with each other at arm’s length; or (b) if the work placement is with a taxpayer other than the particular taxpayer.  2007, c. 11, Sched. A, s. 88 (12). Rules for associated corporations (13) If a qualifying work placement is deemed by subsection (7) to be a work placement with only one of two or more corporations, (a) the corporation designated under that subsection is deemed to have paid all amounts referred to in paragraphs 1 and 2 of subsection (10) that were paid or payable by the corporations, and those amounts are deemed not to have been paid or payable by the other corporations; and (b) the corporation designated under that subsection is deemed to have received or be entitled to receive all government assistance in respect of the work placement that any of the other corporations has received, is entitled to receive or may reasonably expect to receive, and the other corporations are deemed not to have received and not to be entitled to receive that government assistance.  2007, c. 11, Sched. A, s. 88 (13). Certification of qualifying work placement (14) Every eligible educational institution in Ontario that has a qualifying co-operative educational program that has qualifying work placements shall certify in a manner or form approved by the Ontario Minister to every taxpayer providing a qualifying work placement that the placement is a qualifying work placement for the purposes of this section, and the certification shall contain the name of the student in the placement and any additional information required by the Ontario Minister.  2007, c. 11, Sched. A, s. 88 (14). Minister of Finance’s direction and order (15) If incorrect certifications have been given under subsection (14) or an eligible educational institution has certified a work placement to be a qualifying work placement when it was not, the Minister of Finance may direct the educational institution to cease certifying work placements and may order that all or certain of the work placements of the institution be deemed not to be qualifying work placements for the purposes of this section until the Minister of Finance revokes the direction and order.  2007, c. 11, Sched. A, s. 88 (15). Resumption of certification (16) If the Minister of Finance is satisfied that the educational institution will comply with the Minister of Finance’s directions with respect to the accuracy, form and content of certifications to be given under subsection (14), the Minister of Finance, subject to any conditions the Minister of Finance considers reasonable, may revoke the direction and order given under subsection (15), and all work placements that would have otherwise been qualifying work placements while the Minister of Finance’s direction and order were in effect shall, to the extent approved by the Minister of Finance, be considered to be qualifying work placements for the purposes of this section and may be so certified by the educational institution.  2007, c. 11, Sched. A, s. 88 (16). Directions under Corporations Tax Act and Income Tax Act (17) Directions and orders of the nature described in subsection (15) that were made under the authority of the Corporations Tax Act or the Income Tax Act shall continue to have the same effect under this Act until revoked by the Minister of Finance in accordance with subsection (16).  2007, c. 11, Sched. A, s. 88 (17). Partnerships (18) The following rules apply if a corporation or individual (in this section referred to as the “partner”) is a member of a partnership and the partnership would qualify for a fiscal period ending in a taxation year of the partner for a co-operative education tax credit if the partnership were a corporation or individual, as the case may be, and the fiscal period were its taxation year: 1. Subject to paragraph 2, the portion of that co-operative education tax credit that may reasonably be considered to be the partner’s share of the tax credit may be included in determining the amount of the partner’s co-operative education tax credit for the partner’s taxation year. 2. If the partner or any other member of the partnership bases a claim in respect of the partnership for the taxation year under subsection (19), no amount in respect of the partnership may be included in determining the amount of the partner’s co-operative education tax credit for the partner’s taxation year otherwise than pursuant to subsection (19).  2007, c. 11, Sched. A, s. 88 (18). Same (19) If it is acceptable to the Ontario Minister, a partner’s share of a partnership’s co-operative education tax credit determined under subsection (18) for a fiscal period shall be equal to such amount as the partner claims not exceeding the amount, if any, by which the amount of that credit exceeds the total of all amounts each of which is claimed under this section, section 43.4 of the Corporations Tax Act or subsection 8 (15) of the Income Tax Act in respect of the amount of that credit by another partner.  2007, c. 11, Sched. A, s. 88 (19). Limited partner (20) Despite subsections (18) and (19), a limited partner’s share of a partnership’s tax credit referred to in subsection (18) is deemed to be nil.  2007, c. 11, Sched. A, s. 88 (20). Definitions (21) In this section, “eligible educational institution” means, (a) a university or college of applied arts and technology in Ontario, whose enrolment is counted for the purposes of calculating annual operating grants entitlements from the Government of Ontario, (b) the Michener Institute of Applied Health Sciences, (c) the Ontario College of Art and Design, and (d) Redeemer University College; (“établissement d’enseignement autorisé”) “eligible percentage” means, in respect of a repayment of government assistance, the percentage used in determining the amount of the tax credit under this section, section 43.4 of the Corporations Tax Act or subsection 8 (15) of the Income Tax Act, as the case may be, if the receipt of the government assistance reduced the amount of a tax credit available under the applicable provision; (“pourcentage autorisé”) “government assistance” means assistance in any form from a government, municipality or other public authority, and includes a grant, subsidy, forgivable loan, deduction from tax or investment allowance, but does not include, (a) a tax credit under section 39 or this Part, any of sections 43.3 to 43.13 of the Corporations Tax Act or subsection 8 (15) or (16.1) of the Income Tax Act, or (b) a tax credit under section 125.4, 125.5 or 127 of the Federal Act. (“aide gouvernementale”)  2007, c. 11, Sched. A, s. 88 (21); 2008, c. 19, Sched. U, s. 3. Section Amendments with date in force (d/m/y) 2008, c. 19, Sched. U, s. 3 - 01/01/2008 2009, c. 18, Sched. 28, s. 9 (1-3) - 01/01/2009