Hi guys, I figured someone on here would have an answer for me. A few of my coworkers and I, who have just recently signed up for Level 1, were wondering whether there are any tax credits that can be claimed with regards to the cost of the CFA in Canada. I know the CSC qualifies and have been mailed tax forms by the CSI to claim a deduction on tax returns, but am not aware of a similar process for the CFA. Any feedback would be appreciated, thanks!
as far as i know there is not a CFA deduction - its an american institute. i’m only 80% sure i’m correct however. Where are the CFA, CA’s int he crowd?
my friend was audited, you cannot technically use it. but alot of people still do
I did…I have heard varying opinions.
I’m trying to figure it out based on this publication on the Canada Revenue Agency’s website but it seems open to interpretation as it says there is no comprehensive list of educational institutions that qualify…it does allow for foreign institutions, but I guess the results of an audit would be more conclusive. http://www.cra-arc.gc.ca/E/pub/tp/it516r2/it516r2-e.html It’s just odd that the CSC would qualify and this wouldn’t - unless the CFAI isn’t recognized in Canada as a qualifying educational institution. The link above also mentions that it includes professional organizations which offer courses.
I think it only applies to canadian institutions
this thread should’ve stopped at the individual who said “my friend got autided and wasn’t able to use it” case closed. deduct it if you want and if you get audited, be prepared to be red flagged for years to come.
I’ll just play dumb…since I really don’t know either way and see no valid reason why it should not count as education/tuition. I didn’t claim textbooks…
it does not count because it is a “‘foreign correspondence course’”
That sounds like something our kneejerk anti-American government anti-business government/society would do
We discussed this issue last year and it was an open ending http://www.analystforum.com/phorums/read.php?1,599982,600179#msg-600179 What happens if you get audited? and What is penalty if any?
tax law principes are very similar across most common-law countries. I would be very surprised if Canada was any different to US, UK, Australia, etc. If there is no specific tax ruling re CFA costs, then the general principles are: 1. anything of a capital nature is not deductible against current income. Eg if you are an engineer, or doctor or student and spend money to CHANGE careers or ENTER a career or ADVANCE further in a career --> generally not deductible because it’s of a capital nature. 2. But If it is of a revenue nature = generally deductible (unless a specific ruling says otherwise). Eg if the course is used to MAINTAIN (as against increase) base of knowledge in current career, or if it’s necessary to RETAIN current job and current income. So if you already are in investment management or ER, etc, then you can probably argue that CFA is necessary merely to keep up to date and to maintain current knowledge in the field. Specially since CFA is recognized as the global standard in the profession. But since there have been thousands of Canadan CFA students over decades there is bound to be a specific ruling on the matter…spend some time googling the canadian tax sites… a better question is … why is your firm not paying your CFA fees? (assuming you’re already in the industry.) Don’t they think it’s worth it? If not, why not? Will they value it when you get your charter? Will they promote you? If not, ask yourself are you in the right firm??
as others have said, strictly speaking it doesn’t qualify but many people manage to get away with it. I hope you don’t get audited…
Why the tax law discourages changing career?
The only deductions available for educationa re tax credits.The tuition credit right now comes in at 15% of eligible tuition expenditures which the CRA usually limits to post secondary educational institutions. The education credit again is only for full time or part time students and is 15% of 400 per month or 120 respectively…Textbook credit is like 15% of 65 per month, again only for full time students and its 20 per month *0.15 if part time. So really, even if it did qualify, which it doesn’t, its not worth the extra effort for like the 200 bucks youd get as a credit.
Thanks for the clarification guys! My firm does value the CFA and we’re reimbursed the exam fee when we pass. Since one of our colleagues failed in December, he was wondering whether he can claim the first try on his taxes. But I agree with ca-cbv-cfa, a $200 credit is pretty worthless, so I don’t see why anyone would bother using it.
>> a $200 credit is pretty worthless, so I don’t see why anyone would bother using it it takes how long to fill in the extra line on the form ? It’s asinine that you can’t legally claim CFA in canada when courses like french lessons at the local Y are deductible (or at least they gave a friend of mine a tax receipt)