Did you know that the Ontario government has a program that will refund your business up to $3,000 if you hire a co-op student?
The Co-operative Education Tax Credit has been around for about a decade and is a great tool for small businesses, especially businesses that have a busy season. We’re looking into hiring co-op students for ourselves this year.
Why you would want to use a co-op student
Hiring and training new employees is time consuming and expensive. Having the government subsidize training is a great help. If your business is also hiring, this is a good method for finding your next employee with little to no risk involved. At the end of the 8-10 week period, if the student isn’t working out, the term is over. If they are working out, they’re already trained and can be hired after graduation.
How it works
You can get up to 30% of their wages (up to a maximum of $3000) as refundable credit that comes back to you when you file your taxes.
What kind of business qualifies?
According to the Ontario government, a small business is defined as a corporation, partnership or an individual with one or more unincorporated businesses whose total payroll in the previous taxation year was $400,000 or less.
What kind of student qualifies?
From the Ontario Government website: To qualify, a work placement must involve a student who is enrolled at an eligible educational institution (almost every University and college in Ontario, plus some school of Applied Arts and Technology) and performs employment duties for an eligible employer under a qualifying co‑operative education program that is offered by their school. A qualifying co‑operative education program is an educational program or course of study that formally integrates students’ academic studies with work placements. For full details, click here.
How do you find a student?
Universities have procedures in place and offices that help co-ordinate the co-op placements. Here’s a site with a full list of Ontario schools which offer co-op programs.