Canada Revenue Agency
www.cra.gc.ca
Common menu bar links
Income Tax Interpretation Bulletin
Scholarships, Fellowships, Bursaries and Research Grants - Forgivable Loans, Repayable Awards and Repayable Employment Income
NO: IT-340RSR
DATE: May 14, 1986
SUBJECT: INCOME TAX ACT
Scholarships, Fellowships, Bursaries and Research Grants - Forgivable Loans, Repayable Awards and Repayable Employment Income
REFERENCE: Paragraph 60(q) (also paragraphs 8(1)(n), 56(1)(n), 56(1)(o) and 56(1)(p)).
This Special Release amends IT-340R, as indicated below.
1. The recent amendment to paragraph 56(1)(n) excludes from the $ 500 exemption any work related and business related awards, prizes and similar payments received after May 23, 1985. Paragraph 1 of the bulletin is therefore replaced by the following:
"1. Paragraph 56(1)(n) brings into income for a taxation year amounts received as scholarships, fellowships, bursaries and some prizes to the extent that the total amount of these awards received in a year exceeds $ 500; however, the $ 500 exemption does not apply to such awards received out of registered education savings plan nor to those received after May 23, 1985 in the course of business or in respect of, in the course of or by virtue of an office or employment. Research grants are included in computing income by virtue of paragraph 56(1)(o) to the extent that they exceed the aggregate allowable expenses incurred in the year. IT-75R2, "Scholarships, Fellowships, Bursaries, Prizes and Research Grants", contains general comments on the payments included in income under these two paragraphs of the Act. This bulletin deals specifically with such awards and grants where they are in the form of forgivable loans or repayable amounts."
2. Paragraph 10(b) is revised for the 1984 and subsequent taxation years to read as follows:
"(b) the amount repaid was included in computing the taxpayer's income for the year or a preceding taxation year as
(i) an amount described in paragraph 56(1)(n) (i.e., the net amount of the award after the deduction of the $ 500 - see 1 above), or
(ii) an amount described in paragraph 56(1)(o) (i.e., the amount by which the research grant received exceeds the relevant expenses);"
3. Paragraph 11 is deleted.
