What tax credits are available for apprentices?

By Randall Orser | Personal Income Tax

Breaking the Bank TNYou, or a loved one, have decided to embark on a career in the trades, which is great. Fortunately, there are tax breaks for those who go into the trades as apprentices. Of course, you have to prove your apprentice and be registered with the federal or provincial government, and it leads to a certification or designation in that trade.

Tools Expense

You may be able to deduct the cost of eligible tools you bought in the tax year to earn employment income as a tradesperson and as an eligible apprentice mechanic. This cost includes any GST, and provincial sales tax (PST), or HST you paid. You may also be able to get a rebate of the GST/HST you paid.

An eligible tool is a tool (including associated equipment such as a toolbox) that:

  • You bought to use in your job as a tradesperson and was not used for any purpose before you bought it;
  • Your employer certified as being necessary for you to provide as a condition of, and for use in, your job as a tradesperson; and
  • Is not an electronic communication device (like a cell phone) or electronic data processing equipment (unless the device or equipment can be used only for the purpose of measuring, locating, or calculating).

Your employer has to complete and sign Form T2200, Declaration of Conditions of Employment. Have your employer complete question 11 of Part B of the form to certify that the tools being claimed were bought and provided by you as a condition of your employment as a tradesperson. Attach to Form T2200 a list of the tools you are claiming, as well as the related receipts. You do not have to include Form T2200, your receipts, or your list of tools with your return, but you should keep them in case we ask to see them.

Even though you may have already claimed the tradesperson’s deduction for tools, you may also be able to deduct a part of the cost of eligible tools you bought in 2013 to earn employment income as an eligible apprentice mechanic. You are an eligible apprentice mechanic if you:

  • Are registered in a program established under the laws of Canada or of a province or territory that leads to a designation under those laws as a mechanic licensed to repair self-propelled motorized vehicles (such as automobiles, aircraft, boats, or snowmobiles); and
  • Are employed as an apprentice mechanic.

As an eligible apprentice mechanic, you must first calculate the tradesperson’s tools deduction, if any, that you qualify for. You may qualify for that deduction if you bought eligible tools for your job in 2013.

Tax Credits

The provinces and territories also have their own tax credits for apprentices. British Columbia is one such province. In BC you can file a T1014 British Columbia Training Tax Credit (Individuals). You can claim this credit if you were a resident of British Columbia on December 31, 2013, and you completed an eligible program administered through the British Columbia Industry Training Authority or you passed a challenge exam and received a Certificate of Qualification from the British Columbia Industry Training Authority, in the tax year. Eligible programs and completion requirements are defined by Regulation.

Check with your province, your industry training authority, and Canada Revenue Agency, to see what tax credits are available to you.

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