https://decisia.lexum.com/tcc-cci/decisions/en/item/315545/index.do
Fortnum v. The Queen (June 29, 2018 – 2018 TCC 126, Smith J.).
Précis: The taxpayer pursued a one year MBA program at Notre Dame University in Indiana. At issue was the tuition of $21,577 CAD she paid for the summer semester in 2014. CRA denied the tuition tax credit on the basis that she paid for 10 separate courses in the summer semester and that the foreign tuition tax credit only applied to tuition for “a course”. Smith J. rejected the Crown’s arguments and allowed the taxpayer’s appeal. There was no order as to costs since this was an informal procedure appeal.
Decision: The Crown’s position was as follows:
[11] The Respondent argues that the Appellant is not entitled to the tuition tax credit for the summer semester since it consisted of ten separate courses of one or two week duration, each separately coded with different professors or instructors.
[12] The relevant provision of the Act provides as follows:
Tuition credit
118.5 (1) For the purpose of computing the tax payable under this Part by an individual for a taxation year, there may be deducted,
(a) …
(b) where the individual was during the year a student in full-time attendance at a university outside Canada in a course leading to a degree, an amount equal to the product obtained when the appropriate percentage for the year is multiplied by the amount of any fees for the individual’s tuition paid in respect of the year to the university, except any such fees
(i) paid in respect of a course of less than three consecutive weeks duration,
(ii) paid on the individual’s behalf by the individual’s employer to the extent that the amount of the fees is not included in computing the individual’s income, or
(iii) paid on the individual’s behalf by the employer of the individual’s parent, to the extent that the amount of the fees is not included in computing the income of the parent by reason of subparagraph 6(1)(b)(ix);
[13] Therefore, in order to qualify for a tuition tax credit pursuant to this subparagraph, the taxpayer (i) must be attending a university outside Canada on a full‑time basis (ii) in a course leading to a degree, and (iii) the fees must be paid in respect of a course of at least three consecutive weeks duration. Subparagraphs 118.5(1)(b)(ii) and (iii) include further restrictions that are not relevant in this instance.
Smith J. rejected the Crown’s interpretation:
[20] As noted above, the Respondent argues that the word “course” must be narrowly construed as referring to a single course on a particular subject. The Appellant admitted in this instance, that the courses are all separately coded and have different instructors which might support an interpretation based on the “ordinary meaning” of the word: Canada Trustco, supra, para. 10.
[21] However, the word “course” can also support more than one reasonable meaning, (as noted in Siddell and Abdalla, supra), in which case the Court must consider “a textual, contextual and purposive analysis to find a meaning that is harmonious with the Act as a whole”: Canada Trustco, supra, para. 10.
[22] In this instance there is no doubt that the Appellant was in full‑time attendance during the summer semester following courses that lead to a degree. Attendance at all ten courses was mandatory. The Appellant was not entitled to pick and choose. The courses were part and parcel of the summer semester. She registered for the summer semester and paid a single fee. All courses were taken consecutively or “one after the other”, over a ten week semester.
[23] A textual, contextual and purposive analysis of the subject provision leads me to conclude that the tuition fee paid by the Appellant in respect of the summer semester meets the requirements of paragraph 118.5(1)(b) of the Act.
[24] If I am wrong in reaching that conclusion, I find that this is a case where the application of the ordinary principles of interpretation may not resolve the issue, in which case the matter should be resolved by recourse to the residual presumption in favour of the Appellant: Placer Dome Canada Ltd. v. Ontario (Minister of Finance), 2006 SCC 20, at para. 24.
As a result the appeal was allowed. There was no order as to costs since this was an informal procedure appeal.