Can I deduct my child's post secondary tuition as business expense?

phejy wrote: ↑ I have a 1 person professional corporation and have a university student child that is studying in the same field as business.

It is possible to deduction the child's tuition as a business expense somehow? I've heard that it may be allowed if the child's field of study is the same as the business field.

slavka012 wrote: ↑ You can deduct whatever you want. Will it survive an audit? Hell no.

How do you figure your idea makes any sense? SMH

Tiberious wrote: ↑ Actually...it is possible if structured properly with the right documentation and support. Way beyond the scope of this forum, you should talk to your accountant.

General guideline, it has to be something that is open to all employees and not given because your a shareholder. If your not an employee of your corporation, don't even bother.

CRA Tax Folio

3.20 The determination of whether an employer and employee are dealing at arm’s length, or whether a benefit is received by an employee-shareholder in his or her capacity as an employee or as a shareholder, involves findings of fact. There is a general presumption that an individual receives a benefit by virtue of his or her shareholdings in those situations where the shareholder, or shareholders, can significantly influence business policy, except where the individual is able to establish otherwise. Exceptions to this presumption would be a situation where the benefit is available to all employees of the Corporation under the same or similar circumstances, or a situation where the benefit is comparable in nature and quantum to benefits generally offered to employees who perform similar services and have similar responsibilities for other employers of a similar size.

Quentin5 wrote: ↑ You get points for creativity!

It may be possible if they work for you and you pay them wages and they are going to school paid by the business (similar to if you work for a corporation and they pay for your tuition).
That said for a dependent child i'm going to guess the CRA will tear you a new one if it is not allowed and if it is you probably have to structure it carefully based on professional advice.

Tiberious wrote: ↑ Actually...it is possible if structured properly with the right documentation and support.

Just Confused wrote: ↑ Here is something that is not as lucrative as "tax-free" but would save a few dollars.... income split with the child.

Put your child on the payroll as a legitimate fully-taxable employee. Perhaps only part-time if the tuition is low enough. Their lower tax rate, basic exemption and tuition deduction would probably make their net tax to be near zero. This is income splitting with the child; just like with your spouse. It would be cheaper than you withdrawing the money as taxable and then paying their tuition for them. You avoid taking the income out at your presumably higher tax rate. And the business still foots the bill so it remains a corporate deduction. You could go a step further if you want to play with dividends but that has more complex criteria to consider.

Since the child is an age where s/he is going to be technically superior to you (by a generation or more) there is no end of IT/internet/marketing/telecom/remote tasks you could legitimately assign to the child while they are at school. That would address any job description questions. CRA doesn't worry too much if you are paying full employee tax load / payroll taxes.