Funding Opportunities for Trades Workers
26 Government Incentives for Trade Apprentices
Anne Lee
As there’s so much benefit from governments and organizations to support the skilled trades, it is listed the most common supports available to all trade apprentices.
Employment Insurance (EI) – Apprentices
Apprentices leaving their work to attend full-time technical training (ie. block-release training) may be eligible to receive Employment Insurance (EI) benefits while unemployed and attending technical training.
Applying for Employment Insurance as an Apprentice is slightly different than EI regular benefits. Trade Apprentices are required to provide proof of referral to receive EI benefits. The apprentice’s provincial or territorial training institution will issue a 16-digit reference code as proof of referral when you are approved to attend full-time technical training. This reference code is required in completing the online application.
Apprentices can apply for EI benefits up to seven days before your last day of work. This is earlier than personnel applying for regular EI benefits.
The employer will issue a Record of Employment (ROE) to each employee that has an interruption in work. The ROE submitted is the primary information that determines whether a trade apprentice is eligible to receive EI benefits and how much one will receive.
For most people, the basic rate for calculating Employment Insurance (EI) benefits is 55% of their average insurable weekly earnings, up to a maximum amount. As at January 1, 2024, the maximum benefit amount to be received is $668 a week. An amount of 10% is usually withheld from the net amount issued to assist in covering some of the potential tax liability at the end of the year.
Apply for Employment Insurance (EI) benefits through Service Canada, part of Employment and Social Development Canada (ESDC).
EI benefits are taxable income in the taxation year in which they are paid. Individuals are issued a T4E – Statement of Employment Insurance and Other Benefits slip for tax purposes the following calendar year. Any EI benefits received are to be reported on the individual’s income tax return.
Example: Employment Insurance Benefits
Bobby is an ironworker obtaining work-based hours with a sponsoring ABC Company in Manitoba. Bobby has been registered into the next Level 3 of block level training at Red River College and will have a break in work weeks. During the 9 weeks of full-time technical school, Bobby will be unemployed. Bobby is to obtain a 16-digit reference code from the Manitoba province or training institution so Bobby can apply for Employment Insurance as an Apprentice. If Bobby’s last day of work prior to attending technical training is September 30, 2024 then an application for EI can be sent to Service Canada as early as September 23, 2024. Bobby can potentially qualify for 9 weeks of Employment Insurance benefits. Any EI benefits paid to Bobby during calendar year 2024 will be reported on a T4E tax slip issued to Bobby by February 28, 2025 for the filing of the 2024 tax return.
Federal and Provincial Tuition and Education Tax Credit
Generally, tuition fees paid by an individual to a post-secondary educational institution in Canada are eligible for the Federal and Provincial Tuition Tax Credit. Post-secondary institutions will issue students Form T2202 – Tuition and Enrolment Certificate outlining the amount of eligible tuition fees paid to be claimed on the tax return.
There are many courses that are not at the post-secondary school level but are still eligible for the tuition tax credit if the individual is enrolled in the course to obtain skills for an occupation. Example short term courses and certifications common for trade apprentices may include Occupational First Aid, Workplace Safety, and Forklift / Scissor Lift / Boom Lift operator. The Educational Institution will issue an official tax receipt that can be used as supporting documentation if asked by CRA for making the tax credit claim.
Fees paid to an educational institution needs to be more than $100 in a calendar year to qualify as eligible tuition fees. The Federal tuition tax credit available is 15% of the eligible tuition fees paid. Some provinces have a corresponding Provincial tuition and education tax credit available. This can equate to another approximately 5% to 12% of tax credit depending on the Province. The Federal and Provincial tuition tax credit is a non-refundable tax credit. This means that the tax credit will be applied against any current taxes owing during the year but if an individual owes $nil in taxes, the credit difference will not be refunded in cash.
Individuals with eligible tuition fees paid can report on Federal Schedule 11 as part of the filing of the T1 Tax Return to claim the non-refundable tax credit. If the tax apprentice resides in a province with a Provincial tuition and education tax credit available, an individual needs to complete similar form on the Provincial tax return (usually Provincial Schedule 11).
Example: Federal and Provincial Tuition Tax Credit
| Eligible Amount | Non-refundable tax rate | Non-refundable tax credit | ||
| Federal tuition credit | $7,700.00 | 15% | $1,155.00 | |
| Provincial tuition credit (NFLD) | 7,700.00 | 8.7% | 669.90 | |
| Provincial education credit (NFLD) | 600.00
(10 months x $60) |
8.7% | 52.20 | |
| $1,877.10 |
The $1,155.00 of federal tuition credit can reduce federal income taxes owing, and the provincial tuition and education tax credit ($722.10) will be applied against any provincial income taxes owing. If Joseph cannot utilize any portion of the $1,877.10 of tax credit, then Joseph can carry forward any unused tax amount differences to the next taxation year filing. Unused tuition and education amounts carried forward do not have an expiry date of usage.
Joseph may also transfer up to $5,000 of eligible amount to certain immediate family members such as a parent, if Joseph’s tax liability has been brought to $nil and there remains unutilized tuition amounts. To designate a transfer, the second box on the back of Form T2202 – Tuition and Enrolment Certificate needs to be completed and signed. This designation does not have to be submitted to CRA if the tax return is electronically filed. However, the supporting documentation needs to be kept in the chance that CRA asks for supporting documentation.
Apprentice Incentive Grant (AIG) – Ending March 31, 2025
The Apprenticeship Incentive Grant is a taxable cash grant of $1,000 per year or level, for a lifetime maximum amount of $2,000 per individual. An apprentice needs to be registered with the provincial/territorial apprenticeship authority as an apprentice in a designated Red Seal trade, and provide proof that the individual has successfully completed the first year or second year block training.
The deadline to submit an application for this grant is 12 months following your date of progression or March 31, 2025, whichever is earlier.
To receive this taxable cash grant, a trade apprentice is required to complete the application with Service Canada and provide required supporting documents.
Example: Apprentice Incentive Grant
Carl is a plumber (gasfitter) apprentice in Nunavut, and is now studying Level 2 technical training. In order to apply for the Apprentice Incentive Grant for Level 1, Carl needs a copy of the Certificate of Status for the Second Period Level as supporting documentation. In this Territory, the certificate acknowledges that Carl has completed all Level 1 requirements including work-based hours.
Apprentice Completion Grant (ACG) – Ending March 31, 2025
The Apprenticeship Completion Grant (ACG) is a one-time taxable cash grant lifetime amount of $2,000 per person for registered apprentices who get journeyperson certification in a designated Red Seal trade.
To receive this taxable cash grant, a trade apprentice is required to complete the application with Service Canada and provide required supporting documents.
Example: Apprentice Completion Grant
Sarah is a construction craft worker (CCW) in New Brunswick and has completed the requirements for the Red Seal endorsement. In order to apply for the Apprentice Completion Grant, Sarah needs a copy of the Completion Letter from the New Brunswick apprenticeship issuing authority as supporting documentation. In this Province, the Completion Letter acknowledges that Sarah has met all the requirements of qualification and apprenticeship completion. Sarah is thinking of pursuing another Red Seal trade certification. Sarah would not be eligible to apply for the ACG taxable grant again.
Canada Training Credit
The Canada training credit (CTC) is a refundable tax credit available to help Canadians with the cost of eligible training fees. The government is encouraging Canadians to invest in lifelong learning and up skill themselves in an evolving economy.
In 2019 and subsequent tax years, an individual from 25 – 64 years old can accumulate $250 towards the individual’s Canada training credit limit (CTCL) for the next year up to a maximum of $5,000 in a lifetime.
Amount of the credit is the lesser of the individual’s Canada training credit limit for the taxation year, and half of the eligible tuition fees paid to an eligible educational institution during the year.
This tax credit is available to individuals between the ages of 26 – 65 at the end of the taxation year, have eligible tuition fees paid to an educational institution, and have built a Canada training credit limit greater than zero.
Individuals eligible for the Canada training credit can report on Federal Schedule 11 as part of the filing of the T1 Tax Return to claim the refundable tax credit. Note that any claim of the Canada training credit will reduce the amount of eligible tuition fees available to apply for the Federal tuition tax credit during the same taxation year.
Example: Canada Training Credit
Lori is age 33 at the end of 2024. During the taxation years 2019 – 2023, Lori has been filing individual tax returns and accumulated $250 in the Canada training credit limit. The latest 2023 Notice of Assessment shows that Lori’s CTCL is $1,250 (5 years at $250 per year). During 2024, Lori takes a pre-apprenticeship trades program and pays eligible tuition fees of $3,200.
Lori’s Canada training credit claim amount is calculated as follows:
Amount of eligible tuition fees paid at 50%: $1,600 ($3,200 x 50%)
CTCL from latest Notice of Assessment: 1,250
Lesser amount: $1,250
Tuition amount that can be claimed for 2024 is $1,950 ($3,200 – $1,250).
Lori will have a $250 CTCL balance for 2025 that can be claimed on the 2025 tax return filing if there is sufficient eligible tuition fees paid.
| Year | CTC Annual Limit | CTC Claimed | CTC Balance |
| 2019 | $250 | $0 | $250 |
| 2020 | 250 | 0 | 500 |
| 2021 | 250 | 0 | 750 |
| 2022 | 250 | 0 | 1,000 |
| 2023 | 250 | 0 | 1,250 |
| 2024 | 250 | 1,250 | 250 |
Canada Tradesperson’s Tool Deduction
Eligible tools purchased during the taxation year in order to earn employment income as a tradesperson may be deductible as employment expenses on an individual’s income tax return. This cost includes any GST / HST and provincial sales tax (PST) you paid.
The total cost of eligible new tools cannot exceed the total of the employment income earned as a tradesperson and any apprenticeship grants received to acquire the tools, which are required to be included in income.
Complete Form T777 – Statement of Employment Expenses on the Individual and Benefit Tax Return to claim the Canada Tradesperson’s Tool Deduction. Please note that in order to make employment expense claims on Form T777 – Statement of Employment Expenses, it is required to have Form T2200 – Declaration of Conditions of Employment issued from the employer stating that these tools are required for the purpose of your work.
For 2023 and subsequent taxation years, the maximum employment deduction for tradesperson’s tools has increased from $500 to $1,000.
Please note that there is a different calculation specifically for apprentice mechanics.
Tuition Tax Credit – Licensing Examination Fees
Examination and licensing fees paid as a trade apprentice to obtain qualification or certification in the trades are eligible for the tuition tax credit. This may include fees to write the provincial/territorial apprenticeship level exam or Canada Red Seal trade exams. A receipt should be provided to substantiate the eligible exam fees and needed as supporting documentation if CRA inquires.
Individuals with eligible licensing fees paid can report on Federal Schedule 11 as part of the filing of the T1 Tax Return to claim the non-refundable tax credit. If the tradesperson resides in a province with a Provincial tuition and education tax credit available, an individual needs to complete similar form on the Provincial tax return (usually Provincial Schedule 11).
Sample Provincial Apprentice Funding
BC Training Tax Credit for Apprentices
British Columbia residents registered with SkilledTradesBC as an apprentice in an eligible non-red seal or red seal program can apply for refundable income tax credits upon completion of levels of an eligible trades training program. This tax credit is directly applied against any provincial taxes owing. As this tax credit is refundable, if the trade apprentice does not have any BC provincial taxes owing that year, the excess credit amount would be issued to the taxpayer as a cash refund.
There are three types of training tax credits: basic, completion, and enhanced. The basic tax credit is available when you complete the requirements for tax credit level 1 or 2 of a BC recognized (non-Red Seal) program. The completion tax credit is available when you complete the requirements for tax credit level 3 or 4 of a Red Seal or non-Red Seal program. An enhanced tax credit is available if one is a First Nations individual or a person with a disability.
If a trade apprentice qualifies for this training tax credit, one can complete BC Tax Form T1014 – British Columbia Training Tax Credit (Individuals) and submit it as part of the Individual Income Tax Return filing.
Refer to BC Provincial website for further eligibility details and tax credit amounts.
Tax Tip: BC Tax Training Credit
It is recommended that a trade apprentice not apply for this tax training credit on the filing of the tax return until have met all the requirements for each level and have the necessary supporting documents. The BC Tax Training Credit for Apprentices is a refundable tax credit, in which a taxpayer would get a refund if one does not owe any taxes. As this tax credit is not very common (specific to BC Trade Apprentices) and the amount is on the high end of refundable credits available to individuals, there is increasing likelihood that CRA will flag the return in a pre-audit and request for proof of supporting documentation. If one was to obtain this refundable tax credit and then later CRA denied the claim, a taxpayer would have to not only pay the amount of the tax credits back but also there could potentially be interest and penalties assessed by CRA.
Example: Red Seal Trade Apprentice – British Columbia
Kevin is a glazier trade apprentice in the province of British Columbia. Glazier is a red-seal trade and Kevin would qualify for the BC Tax Training Credit on completion of Level 3 and Level 4 of the program. Kevin is required to complete 4,800 work-based hours for completion of Level 3 for this tax credit. It is recommended that Kevin not apply for this tax credit until at least 4,800 work-based hours are recorded on Kevin’s transcript with SkilledTradesBC.
Tax Tip: T1 Adjustment Request
If a BC trade apprentice has already filed the tax return related to the year that one qualified for this tax credit, Canada Revenue Agency allows a taxpayer to file a T1 Adjustment Request to apply for this significant refundable tax credit. An individual usually has 3 years after the date of the latest Notice of Assessment is issued to file a request to change the tax return.
Example:
Justin is a forklift mechanic trade apprentice, an eligible non-Red Seal program in the province of British Columbia. Justin has already filed the 2023 tax return into CRA electronically April 28, 2024. CRA issued Justin a Notice of Assessment dated May 15, 2024. Justin realizes in July 2024 that he did not apply for the BC Tax Training Credit for Apprentices on the 2023 tax return even though Justin completed all the requirements of Level 1 in 2023. Justin can file a T1 Adjustment Request to CRA to change his tax return and apply for this credit. Justin has until May 15, 2027 to initiate this request with CRA, but will apply for this basic level 1 tax credit so that he can obtain the $1,000 cash refund earlier.
Alberta Apprentice Training Award
The Apprentice Training Award is a $1,500 financial award for registered apprentices who are unemployed in their trade and attending classroom instruction at an Alberta-approved classroom instruction provider.
Ontario Tools Grant
This is a non-repayable tools grant that is available to Ontario apprentices, to assist trade apprentices to pay for tools and equipment related to the apprentice’s trade.
Amount of the grant depends on the type of trade one is apprenticing in:
- $1,000 for motive power trades
- $600 for construction trades
- $600 for industrial trades
- $400 for service trades
Ontario Apprentice Development Benefit
The Apprentice Development Benefit provides financial assistance for apprentices while they are attending full-time, in-class training at a ministry-approved training delivery agent. The costs can include:
- Basic living expenses
- Dependent care
- Commuting and travel
- Expenses for living away from home
- Special assistance for persons with disabilities
